Reply to: Another tax return question

[GoodBytes]

https://www.gov.uk/government/upload...notes_2015.pdf

You are at risk of over-analysing this though. The reason you have been asked to complete an employment page is because of the system, not the rules.

Yes, the rules I read say one thing, the online tax return software assumes something different.

[Contreras]

1 Employment

You should fill in the ‘Employment’ page if you:

• were employed in full-time, part-time or casual employment
• received income as a company director
• held an office, such as chairperson, secretary or treasurer and received income for that work
• worked for 1 person through another company or partnership, for example, agency work
• were resident in the UK and received an income from any foreign employment

You will need a separate ‘Employment’ page for each job, directorship or office.

If you were a company director and didn’t receive any income or benefits, but expect to do so in future, just complete boxes 4, 5 and 6 of the Employment page. This will mean you don’t have to re-register for Self Assessment.

https://www.gov.uk/government/upload...notes_2015.pdf

You are at risk of over-analysing this though. The reason you have been asked to complete an employment page is because of the system, not the rules.

[GoodBytes]

Except it isn't possible if you're not PAYE registered.

I have to record the directorship in the drop down list that asks how many employments, and directorships have you had. It then adds an employment page for each item including the directorship. Are you saying I was given incorrect information?

[VectraMan]

Thought I'd mention that I spoke to HMRC today, and surprisingly they were very helpful. I must record an unpaid directorship in an employment page, despite no income. Odd but them's the rules.

Except it isn't possible if you're not PAYE registered.

[expat]

Thought I'd mention that I spoke to HMRC today, and surprisingly they were very helpful. I must record an unpaid directorship in an employment page, despite no income. Odd but them's the rules.

It's not at all surprising. HMRC can be very helpful. They can be very helpful even when that results in your paying less tax. They are not in business to maximise tax take, but they do care a lot about people obeying the rules. They will usually go a long way to helping you understand the rules.

The only exception is IR35 where they are caught in the same bind as the cage fighters in Mad Max Beyond Thunderdome: "I know you won't break the rules: there are no rules".

[GoodBytes]

Thought I'd mention that I spoke to HMRC today, and surprisingly they were very helpful. I must record an unpaid directorship in an employment page, despite no income. Odd but them's the rules.

[TheCyclingProgrammer]

Check the page where it asks you to select how many directorships you had again. It will probably tell you not to count any unpaid directorships.

[GoodBytes]

I have gone through it again, and as I was a director, I must select 2 in the employments and directorships drop down. This then forces 2 employment pages to appear even though the dirctorship was unpaid. So it looks as if I must fill in two employments, all a bit confusing. Hi ho.

I also cannot figure out how to set no for Trusts, Capital Gains Summary etc. Bizarre.

[GoodBytes]

Thanks all, very helpful. I will read through the comments more carefully, and look at the suggested HMRC notes, at the weekend when I have more time.

[TheCyclingProgrammer]

I've been through this a couple of times with the online SA because I kept my company going whilst a permie, but deregistered from PAYE (and VAT). The form says something misleading like "how many employments or directorships in this period", so I say 2, but then it asks for a PAYE reference for the directorship, which I don't have. The only way to fill out the form is to say 1 and not include the directorship in that section. If you earned any dividends you enter it in a later section as if you were a shareholder only.

I hope that's right.

If you check, I think it says something about not needing to fill out an employment sheet for a directorship if you received no wage or expenses/benefits.

[northernladuk]

I've been through this a couple of times with the online SA because I kept my company going whilst a permie, but deregistered from PAYE (and VAT). The form says something misleading like "how many employments or directorships in this period", so I say 2, but then it asks for a PAYE reference for the directorship, which I don't have. The only way to fill out the form is to say 1 and not include the directorship in that section. If you earned any dividends you enter it in a later section as if you were a shareholder only.

I hope that's right.

If it's not you could bunk in with Mr Upton and enjoy spending 23 hours a day chatting about the finer points of accounting with him.

[VectraMan]

I'm fairly certain you only need to fill out an employee sheet for a paid directorship. If you took no salary or claimed no expenses I don't think you do. Either way if you do it online the HMRC software should figure this all out for you and tell you what sheets you need after you've answered its initial questions.

I've been through this a couple of times with the online SA because I kept my company going whilst a permie, but deregistered from PAYE (and VAT). The form says something misleading like "how many employments or directorships in this period", so I say 2, but then it asks for a PAYE reference for the directorship, which I don't have. The only way to fill out the form is to say 1 and not include the directorship in that section. If you earned any dividends you enter it in a later section as if you were a shareholder only.

I hope that's right.

[TheCyclingProgrammer]

My accountant informed me I only needed to add my permanent employment which started in May 2014, as I received no salary from my company in 2014-2015, the company closing down.

I'm fairly certain you only need to fill out an employee sheet for a paid directorship. If you took no salary or claimed no expenses I don't think you do. Either way if you do it online the HMRC software should figure this all out for you and tell you what sheets you need after you've answered its initial questions.

[Contreras]

My accountant informed me I only needed to add my permanent employment which started in May 2014, as I received no salary from my company in 2014-2015, the company closing down.

This is partially correct - please see again my reply above.

However in your situation, assuming the company still has an Employer Reference, I would just fill in the employment page with nil amounts. As per your other thread, sometime it's easier just to work with the system, if the outcome is the same.

Have you read the separate SAR guidance notes (SA150)? If not then you really ought to. The question is answered right there in Section 1.

[ASB]

My accountant informed me I only needed to add my permanent employment which started in May 2014, as I received no salary from my company in 2014-2015, the company closing down.

read the notes paying particular attention to the first paragraph and what it says about box 6 and how that fits in with your position.

The notes do explicitly state you do not need to put a form in for directorships that are unpaid (or other offices). However they are not explicit for employments.

Your accountant will be much more aware of your overall position but putting the form in with nil entries if appropriate is fine. You probably were not an emplyee whilst you were a director (unless you had a contract of employment) though you probably were after ceasing to be a director (if you did anything for the company).