Trying to do my tax return and I am confused!

[amirose]

Net Profit is £8936.
Allowance is £6475.
So taxable amount is £2461
20% is £492.20

So why is my tax return saying I owe £749.88 :panic:

It does say Class 4 NIC's due £257.68 and having added that to £492.20 that does make exactly £749.88.

BUT I pay a monthly direct debit "DIRECT DEBIT PAYMENT TO HMRC - NI DD REF XXXXXXX" of £9.60.
Surely that means I have already paid my NIC? Or what the hell am I paying for?! :laughing:

Please could someone help explain!! :blush:

[atmkids]

Class 4 NI is seperate to the normal monthly contributions we pay I'm afraid.

[Chatterbox Childcare]

Net Profit is £8936.
Allowance is £6475.
So taxable amount is £2461
20% is £492.20

So why is my tax return saying I owe £749.88 :panic:

It does say Class 4 NIC's due £257.68 and having added that to £492.20 that does make exactly £749.88.

BUT I pay a monthly direct debit "DIRECT DEBIT PAYMENT TO HMRC - NI DD REF XXXXXXX" of £9.60.
Surely that means I have already paid my NIC? Or what the hell am I paying for?! :laughing:

Please could someone help explain!! :blush:

Once you make a profit you pay class 4 too anyway

If you make more than £1000 profit you pay half the tax again prepaid in Jan 2012 and then again the other half in Jul 2012 and you will be upfront

I can't see why your figures don't tally

Look at the summary and it should explain it all

[Minstrel]

Agree- The direct debit you pay is for class 2 contributions and once you make profit over about £5175 you have to pay class 4 contributions at 8%.

hth

[amirose]

Ok thanks for the help, much less confused now!
This is only me 2nd year and last year I didn't make anything above the allowance. I am now trying to decide if I should redo it and see if I can up the expenses. There's always things missed that can be added.

[MrAnchovy]

If you make more than £1000 profit you pay half the tax again prepaid in Jan 2012 and then again the other half in Jul 2012 and you will be upfront

That should be "if you have more than £1,000 tax and Class 4 NI to pay you pay an extra half as much again in Jan 2012 and the other half in Jul 2012" :D