Trading Allowance

[Corvid]

I took early retirement earlier this year. I am looking to do some small scale work to keep me active and to add a little bit of funds towards my hobbies.

I thought that one of these pieces of work could be put through the £1000 Trading Allowance. It is casual work invigilating for exams. The organisation that I may be working for make clear that I am an appointee and am not an employee. That is fine by me.

They go on to say that I will be paid through PAYE and receive a P60 at the end of the year.

Would this mean that I would not be able to use the Trading Allowance to avoid paying tax?

I normally complete a tax return so would it be possible to reclaim the tax through the Trading Allowance when I complete my tax return?

Corvid

[bluedonkey]

The trading allowance is for self employed. It sounds to me absolutely that you will be treated as an employee for tax purposes, therefore no trading allowance. Your P60 figures (gross pay and PAYE) will be included in your self assessmen tax return.

[pochisoldi]

As already stated, the trading allowance can't be used against PAYE income.
You might find this page useful, as it clearly explains what the allowance is, and how it can be used.
Note that it is an allowance against "income" not an allowance against "profit" - this is an important distinction as any self employment with expenses in excess of £1000 would end up with a higher tax bill, or be unable to carry forward any losses (thus unnecessarily increasing a future tax bill) if they make use of the trading allowance.

https://www.litrg.org.uk/tax-guides/sel ... -allowance