Being self-employed and paying taxes in the UK is a rough experience (I would know), especially for first timers who have little understanding of taxes, but the government is looking for new ways to make the system easier.
UK Chancellor George Osborne announced one of these new systems for self-employed in the UK, allowing them to file self-assessment statements online from now on.
Self-employed individuals will be able to update their payments monthly or annually, allowing for a fresh record for the government. This service will be available for all UK citizens in 2016.
Osborne announced the personal allowance will hit £11,000 by 2017, moving from £6,500 when the Conservatives took office in 2010. Next year we will see the personal allowance hit £10,850, following a £200 rise of 2015.
Under the next election, Osborne claims Class 2 National Insurance will be abolished for self-employed. This should save a few pounds every month, although it will mean those self-employed will need to look elsewhere for pensions.
The worker’s tax credit is also changing to allow less self-employed the opportunity to take tax credits for work that is not self profiting. It follows a series of public cases where self-employed used tax credits to avoid major spending, without a real business.
Osborne is hoping these changes will make freelancers in the UK more adept when it comes to paying taxes, and hopefully remove some of the burdens of normal jobs from those working at home.