25 February 2022
Taxes for a Self-Employed Person in UK
Taxes for self-employed people in the UK: VAT registration, National Insurance contributions and NIC classes, plus advice on the visa you need.
If you have settled in the UK and you wish to start your own business, it is recommended to ask for assistance in taxation matters. Besides giving full information and guidance about the needed visas to enter the UK, our immigration solicitors in London can provide you with details about how to pay your taxes as a self-employed person in the country. Plus, they can offer support for UK residence card or British citizenship.
Register for VAT as a self-employed in the UK
The HMRC (His Majesty’s Revenue and Customs) is in charge of the taxes on companies and natural persons in the UK. If your business has a VAT-taxable turnover above £90,000 you should register for VAT with the HMRC, where you need to provide your documents as a self-employed, in order to receive the VAT certificate. If your taxable turnover is less than £90,000, you can register voluntarily for VAT, unless your business deals with products that are exempt from taxation. Once you have received the VAT certificate, you will pay the taxes to the HMRC, submit the VAT returns and of course keep the records of such tax. We remind you that the standard VAT rate for goods and services in the UK is settled at 20%. if you want to study in the UK, you should apply for a student visa and before that ask for complete information from our UK immigration lawyer. Our team can help foreigners obtain a residence permit in UK or British citizenship.
The National Insurance Contributions in the UK for self-employed persons
Local or foreign self-employed persons in the UK need to register for the National Insurance Contributions (NIC) and pay the taxes to the HMRC. Moreover, it is good to know that no NIC or tax is deducted from self-employed revenue, but the necessary payments need to be made to the HMRC in the UK. A self-assessment tax return needs to be filled at the end of the year with the authorities in charge, in order to see what taxes you need to pay. Our UK immigration lawyer can offer guidance in this matter if you want to relocate in the country and start your own business. Also, they can help you apply for a UK residence card.
NIC classes in the UK
There are two different NIC in the UK, according to the type of business and profits you have. For instance, the Class 2 NIC, voluntary since 6 April 2024, costs about £3.50/week and can be paid from the obtained revenues which are falling under the category with low profits as a self-employed. The Class 4 NIC is available for larger profits of self-employed businesses in the UK, charged at 6% on profits between £12,570 and £50,270 a year, with 2% on profits above £50,270. Our London immigration lawyer can give more details on this matter.
If you want to know more details about the taxes you need to pay as a self-employed person in the UK, we invite you to contact our team of immigration solicitors in London. You can also receive support for obtaining a residence permit in UK or even British citizenship from our London immigration lawyer.