Employment, self-employment, class 1 AND 2 contributions + 4?

[YoBear]

Hi:)

This has bugged me for some time and I am hoping for some guidance.
I am a self-employed actor who has had some abysmal income for the last two years i.e. less than 1Kpa and use my employment to finance my lifestyle i.e. PAYE £25Kpa.
I am paying Class 1 contributions for my PAYE employment but should I also be paying Class 2 contributions for the fact of my class 1 contributions? Should I simply apply for Class 2 exception? Will I lose any benefits by not paying Class 2 NI contributions?
Finally, on a tax return they have separated the tick boxes for Class 4 contributions Exceptions and Deferment into two separate boxes. In light of my earnings and circumstances, which one should I be ticking?

Thank you in advance in answering this.

[deanshepherd]

As your earnings from self-employment are below the small earnings threshold of £4,315 then you can apply for exception from paying class 2 NIC. You can also claim a refund of overpaid contributions to date.

You will not be paying any class 4 anyway as your income does not exceed £4,895. You do not need to tick any of the class 4 boxes as neither apply to you at this stage.

Your PAYE earnings are not high enough to apply for deferment of class 2 and class 4 NIC so this is not an option.

The Class 1 paid on your earnings will be sufficient for state benefits purposes so cancelling your class 2 will not be a problem.


Dean Shepherd
dean.shepherd@mmi-online.co.uk
MMI Accountancy
www.mmi-online.co.uk