NJB Taxback

This year has been very different and, for many, a very challenging 12 months. For the construction industry, particularly, the true cost of COVID-19 may only start to be realised now. We estimate that 95% of the construction industry will not receive a tax rebate this year.

All of the SEISS grants are subject to tax and national insurance. For the majority of taxpayers, the combined rate is 29%. That means 29% of the support you received will now be due back to HMRC.

So if you received £10000 in Grants, the cost of those grants is now £2900, and this cost will now be included in your tax calculation. This will significantly impact your repayment, and some clients may even receive a tax and national insurance bill.

To help guide you through how the true cost of COVID-19 will affect you, we have developed this calculator for you.

Here is a detailed breakdown of how this calculation is perfomed

You told us that your income was £0 and you had Tax Deductions of £0

This calculation also rightly takes into account your SEISS grants of £0, so your total income was £0.

This calculation includes a total of £0 in estimated expenses for you.

This calculation returns a net profit of £0 (Total income - Total expenses). Your net profits determine how much tax and Class 4 national insurance is due. Your net profits are also what any financial lending/grant claims are based upon; it affects the amount you can borrow and interest rate.

Self Employed Class 4 National Insurance is charged at 9% of all net profits over £9500 so the more your profits are, the more N.I will need to be paid.

Click to see full breakdown

This is a breakdown/explanation of how a tax calculation is performed based on the information you have inputted.

Start with your Gross (Total sales, revenue, income, earning, top line, turnover).

Gross income:

£0
Deduct your allowable outgoings/expenses from your income (Gross). This gives you your net profits. No tax charged, deducted, paid is considered at this stage as your net profits are not the taxable amount.

Gross income:

£0

- Expenses (estimated):

£0

= Net Profit:

£0
Deduct your Personal allowance. This is the tax-free amount that everybody is entitled to earn and rises slightly each year; for 2020/2021 it is £12,500. This gives you your Taxable Income.

Net Profit:

£0

- Personal Allowance:

£12500

= Taxable Income:

£0
Now, the amount of Tax due is calculated on the Taxable Income. The tax rate for Taxable income up to £37500 is 20%, any Taxable income over the £37,500 basic rate threshold is taxed at the 40% higher rate.

Taxable Income:

£0

Income Tax due:

£0
Now, the amount of Class 4 National Insurance due is calculated on your net profit minus the Class 4 threshold of £9,500. The rates for Class 4 N.I is 9% of your net profit up to £40,500, net profit over the £40,500 basic rate threshold is subject to the 11% higher rate charge. This calculation also includes the Class 2 NI contribution which is £158.60 for 2020/2021.

Net Profit:

£0

National Insurance Class 4 Threshold:

£9500

National Insurance due:

£0
We then combine your Income Tax and National Insurance to get the total due.

Income Tax due:

£0

+ National Insurance due:

£0

= Total due:

£0
Now we deduct the total due from the amount you have already paid to calculate your expected refund.

Already paid:

£0

- Total due:

£0

= Refund expected:

£0
Now we deduct the amount you have already paid from the total due to calculate your outstanding tax bill.

Total Tax and NI due:

£0

- Already paid:

£0

= Amount outstanding:

£0

You owe money to HMRC. The total amount due to HMRC by the 31st of January 2022 is £0.

This breaks down as follows:

Total tax and NI due:

£0

Already paid:

-£0

Tax outstanding:

£0

National Insurance outstanding:

£0

That is the unavoidable cost of your Taxable SEISS grants. That amount is due to HMRC by the 31st of January 2022.

How to pay HMRC

To make an online payment to HMRC Self-Assessment:

Log on to your online banking
Create a payment to a company: HMRC Self-Assessment Cumbernauld
Include your reference which is your UTR number followed by K, for example 1234567890K

The payment screen should look similar to this:

Payable amount:

Account name:

HMRC Cumbernauld

Sort code:

08-32-10

Account number:

12001039

Reference:

1234567890K (this is an example -- use your UTR followed by K)

You do not need to log on to an HMRC portal to pay HMRC.

We suggest setting up a monthly standing order for £ per month, starting on the 19th of each month, and you should pay this for months. This will ensure the full amount owed to HMRC is paid with minimal impact on your immediate cash flow.

Alternatively, you may wish to negotiate a Time to Pay agreement with HMRC that may allow you to spread the payments over a longer term. You can either do this online or by contacting the dedicated coronavirus helpline on 0800 024 1222 once your return has been submitted.

Useful help pages:

Help
The cost of COVID

Your predicted rebate: £0

Here is a detailed breakdown of how this calculation is perfomed

Click to see full breakdown

How to pay HMRC

Help The cost of COVID

Your predicted rebate: £0

Here is a detailed breakdown of how this calculation is perfomed

Click to see full breakdown

How to pay HMRC

Help
The cost of COVID