Do I have to pay Self Employed Class 2 National Insurance Contributions bill I've received, I have not made a profit yet.?

Question

Hello,

I started selling my self published book via my website in August 2014 as a Sole Trader. I have not as of yet made a profit from a few sales - my expenses have not been covered  yet and so I am currently still at a loss.

In Oct 2014 I received my first class 2 NIC's bill for £22.00 which I paid thinking I had to. Now I have received a second bill for over £70 reading into it it would seem as I have made no profit I do not need to pay this.

Do I need to complete a form/send info regarding this to HMRC - which form? How can I claim the previous payment made back if I do not need to pay. (I'm currently full time employed and so pay the normal employed taxes separately)

Many thanks in advance for help and replies :)

flower · Answer

Thanks for replies, I called the tel no on the bill. The advice I was given was to write in to the HMRC explaining I've made no profit. I'll do this then I assume if I make a profit moving forward the Class 2 NI will be added to my bill then yes?

Harley Drive · Answer

if you have registered as self employed you have to pay the £70 is for 6 months and it all goes towards your old age pension class 2 NICs are nothing to do with national insurance you pay as an extra tax ( 8%) on your earnings, if you are unemployed which effectively you are you can register as such and get the payments made for you

? · Answer

You apply for a "low earner" exemption. Call the S.A. helpline number for detailed advice.

Clive · Answer

Appeal against the assessment on the grounds that your profit was zero.

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Do I have to pay Self Employed Class 2 National Insurance Contributions bill I've received, I have not made a profit yet.?

4 Answers