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Steven Lockie
January 26, 2023
Question

PAYE earnings and self employed

  • January 26, 2023
  • 1 reply
  • 0 views

Hello,

 

I have PAYE earnings, (tax and NI stopped at source) and self employed earnings (tax also stopped at source).

 
I have BOTH PAYE  and self employed earnings. BOTH earnings are stopped tax and NI at the source. In other words I'm paid the net amount for both. 
 
I have entered the PAYE as stated in the tax profile. But someone told me to change my personal allowance to £0. I'm unsure why (I'm on marriage allowance) but it has incurred a cost of £400 odd of tax now. 
 
So I'm not sure I'm doing the right thing, or I leave my personal allowance as £12570 plus transfer marriage allowance of £1260. That then takes the tax to £0. 
 
Further more, if I'm putting my self employed income earnings on my QuickBook profile, is QuickBooks then assuming I haven't paid tax on that money and need to pay again?!?!
 
HELP!!!

 

1 reply

Rose-A
Rose-A
January 27, 2023

Thanks for checking with us, Steven Lockie.

 

Allow me to share some information regarding the correct process and accounting for P45 income within QuickBooks Self Employed.

 

It is correct that you would record it in the tax profile; however, you would adjust the personal allowance section because the PAYE would affect how much allowance you have remaining. If you have exhausted your allowance, you can change the figure in that section to zero. This means that the income tax has been calculated correctly. 

 

If you need more details about this, we can coordinate with your tax professional. They will be able to advise on how to report this type of expense and answer any tax-related questions you may have.

 

Additionally, in case you need  help with the categorisation, we can refer to this article: Updates to expense categories in QuickBooks Self-Employed. This will help guide you on how to report your self-employed income and expenses. Even if the article is for QuickBooks Self-Employed (QBSE) US, the same concept can be applied to your UK account.

 

If there's anything else I can help you with, please let me know. I'd be more than willing to lend you a hand.

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