Commercial divers employed or self employed? help

[haydenwhiteford]

Hi please help, I am a commercial diver that has been self employed for 5 years, however every diving company i have worked for pays my tax, some even my national insurance, but i have never signed a contract of employment, had holiday pay or sick pay. this year i have received a letter from hmrc stating my accounts do not match up with what the companies i have worked for state, Im very confused. last year i worked for a company for 5 months, they took the tax off my invoice but not the N,I. it seems that these companies are all very different on how they use contractors ect, and as a consequence im in trouble, does anyone have any advice on the situation?

[Ian McTernan CTA]

You just need to ask what figures the Revenue have received and from what 'employers', so that you can compare this to your own list and see where the error lies.

It's not uncommon to have this happen for subbies where payment dates and vouchers fall into a different tax year. It's also not very uncommon to find that a payment has been assigned to you that isn't yours, so check carefully - and check your bank account too, to ensure you have accounted for all payments either side of the tax year too.

Usually these things clear up fairly easily, and the Revenue will adjust your self assessment after all the facts are clear.

Sometimes you get a paranoid Revenue officer who thinks everyone is cheating, so sometimes it can be a bit more of a battle to reach the end.

[DerekMoore]

If the diver is engaged in exploration and exploitation on the UK continental shelf his income is assessed under s15 ITTOIA and taken out of ITEPA by s6(5). Under the current practices the diver is the above is issued a NT tax code, but pays a class 1 NIC.

At the end of the year the employer will issue a P60 and that should be used if diver is using fiscal year accounting as the sum of the income from that company. If the diver works for more than one company as some do then the sums should be added to get the total annual figure.

Divers engaged working outside the UK in exploration and exploitation works have the income subject to employment income and charged under ITEPA. The majority working for foreign companies outside of the EU, in most cases have no tax is deducted.

Divers who work in civil engineering are usually paid through the CIS scheme as construction activities and I suspect that as you have had tax that would be the case. If they have paid NI as well then you would be in an employment not self employment and that might be the case when working in shipping activities.

Your accountant should be able to work out what income is derived from what source and apportion the SA accounts for the period