1M SELF-EMPLOYED FACE TAX BILL LARGER THAN EARNINGS



October 28th, 2020.


One million of the UK’s 4.5m self-employed face having to prepay tax bills higher than what they actually earned this year.

Many freelancers pay self-assessment tax bills on account twice a year, with the first prepayment falling due this January. This is despite the Covid pandemic decimating many self-employed profits since March.

The problem is that prepayments are based on the previous year’s profits, in this case, what the self-employed earned in 2019-20 – before the pandemic hit.

TaxScouts, an online self-assessment tax service provider, estimated 1m people could be hit with an inflated tax bill because payment on account is based on the previous year’s earnings.

“While this is well and good in normal times, it doesn’t take into consideration the huge loss of earnings that so many of the self-employed will have faced during the pandemic,” said TaxScouts.


For the full story at smallbusiness.co.uk CLICK HERE.
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