iOS Got my first payment. Can I spend it?!!

[imPoddible]

Haha sounds stupid, I know

I got my first payment today. From the US region...

Question: Can I spend it all!? Or do I have to put aside 40% for tax reasons?

I'm in the UK and guess I'll have to pay tax on this but would just like some advice from other UK tax payers.

Do you spend yours?



imPoddible.

 

[robbieduncan]

Do you have other sources of income that put you in the 40% tax band? Personally I'd be saving enough of it to cover my expected tax liabilities, but you could just spend it all and then find the money for the IR when you need it...

 

[RobertBlackburn]

40%! how much did you make! lol

I suggest using this income tax calculator http://listentotaxman.com/

You can earn:
£0 - £6035 Tax free.
£6035 - £37400 20% Tax.
£37400+ 40% Tax.

You will have to research into paying your Tax and NI as its not an automatic process.

Remember the tax is based on your total earnings so it includes any other jobs you may have.

 

[imPoddible]

Do you have other sources of income that put you in the 40% tax band? Personally I'd be saving enough of it to cover my expected tax liabilities, but you could just spend it all and then find the money for the IR when you need it...

Yup - in my day job, I pay 40% tax.

I know I can earn up to 6000 UK pounds before I have to pay tax on some things like selling share and stuff - but don't know if this also applies to what I will earn from the app store....

imPoddible.

 

[robbieduncan]

Yup - in my day job, I pay 40% tax.

I know I can earn up to 6000 UK pounds before I have to pay tax on some things like selling share and stuff - but don't know if this also applies to what I will earn from the app store....

imPoddible.

You are refering to capital gains: this is not a capital gain: it's income so you will be paying 40% tax on it.

 

[imPoddible]

You are refering to capital gains: this is not a capital gain: it's income so you will be paying 40% tax on it.

Thanks Robbie,

So maybe it wasn't such a dumb question after all...

OK - for now, whenever I gate payments from Apple, I'll put 50% in my savings account

That should cover me for any taxes in the future.

Cheers!

imPoddible.

 

[Luke Redpath]

You'll need to let HMRC know that you need to submit a self-assessment return at the end of the tax year where you will have to fill out an Employment sheet for your main job and your additional income which will be taxed at the higher rate if you're already on that rate.

Not entirely sure how NI contributions are calculated - when you're registered as self-employed you usually pay a certain class of NI contributions but I don't know how it works on additional income.

Fortunately I put all of my iPhone sales income through my Ltd company so its a lot simpler.