INCREASE IN TAX PAYMENTS FOR THE SELF-EMPLOYED

Due to the changeover from Children’s Tax Credit to Child Tax Credit self-employed earners who qualify for both (and have submitted their Child Tax Credit claim) should now be receiving payments direct into their bank account (or partner’s account). The tax payment made January 2003 and the payments due July 2003, January 2004 and July 2004 continue to be based upon the old allowance system. The January 2005 payment will claw back relief and could be almost £800 higher than the previous years payment, assuming profit levels remain constant.  

On top of this shock, the January 2005 payment will also be the first payment to take into account the extra 1% National Insurance payable. For a person earning £15,000 a year, the January payment will be over £150 higher. 

If you have concerns regarding the above or wish to discuss your future tax payments please contact any member of our team.