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buzzy bee
13-04-2012, 10:56 AM
What is our allowance before tax, and what % tax do we pay on our taxable income?

Or does it vary per person?

Thanks! :thumbsup:

Florasmummy
13-04-2012, 01:35 PM
Hello!

The personal tax allowance for the 2011/2012 tax year is £7,475 and is going up to £8,105 for the 2012/2013 tax year so we don't pay any tax on earnings up to this amount. After this it's 20% tax on anything up to £35,000 for 2011/2012 or £34,370 for 2012/2013.

Hope this makes sense and helps you. More info is on the HMRC website: http://www.hmrc.gov.uk/rates/it.htm

sillysausage
13-04-2012, 03:35 PM
And don't forget you will have class 4 national insurance contributions to make at a rate of 9% on any net earnings over £7225 (£7605 for 2012-2013). This is in addition to the £2.50 per week self employed class 2 national insurance contributions you should be paying (£2.65 per week for 2012 -2013).

buzzy bee
13-04-2012, 04:58 PM
Thank you... I didn't know about the class 4 ni - do they bill us for this or do I need to do something?

Also how much of our income can we offset as allowable expenses?

Florasmummy
13-04-2012, 08:14 PM
The Class 4 NI contibutions are calculated when you submit your self assessment tax return. You then have to pay them with your income tax.

You can claim up to two thirds of your income as expenses as long as you keep a record of it. You don't need a receipt for anything under £10. This page has some helpful info: http://www.hmrc.gov.uk/manuals/bimmanual/bim52751.htm

Hope this helps!