Advice: poker as sole income/ NI contributions

benc

A couple of people have asked me about what happens with national insurance when poker is your sole income and i'm pretty clueless about it all so was hoping to get some advice from some other pros in here, is it a case of just paying monthly/yearly? anyone have something setup who can fill me in a bit on the best way to approach the situation would be appreciated. 

ajs4385

Never bothered personally. If you want to you can make voluntary contributions it is £13 a week i believe.

You only need 35 years contributions to qualify for full pension

So even if pension age stays at 67 (which probably wont), you only need to start with contributions at the age of 32. Obviously later if you have already made contributions in previous employment.

You can also back date voluntary contributions, if you need to.

My investment plans consist of save up buy a house then repeat.

day4eire76

I could be mistaken but seem to recall Ryan (scotty77) talking about this on the forum before.

Maybe somebody can recall the thread and point you in the right direction.

unknown_username

ask a accountant imo

imo you being self employed and when i was self employed it was much lower than £13 a week.

useful link

http://www.pokersites.co.uk/taxes/

http://www.ehow.co.uk/info_12257010_pay-tax-lottery-gambling-winnings.html

CxE1

Gambling in not taxable. Try the link

http://www.hmrc.gov.uk/ni/volcontr/basics.htm

ajs4385

It is a non employed voluntry contribution so may be different to self employed stamp.

It is correct gambling is not taxable, but you have to have so many years ni contributions to get full state pension. Many people who are non employed (for whatever reason) will still actually get the voluntry contributions.

If you want to read further it goes into detail on goverment websites, just google national insurance contributions.

benc

Thanks for the responses, yeah i have taken a look, it looks like we fall into class 3 as not actually self employed, AJ on a sidenote you plan on saving for a house and repeat, you reckon you could get a mortgage or would just be saving to buy outright? 

ACEGOONER

Hi Benc

Lots of information been posted here some of it is incorrect. Firstly if you want to claim the state pension you would need to register as self employed and then file a self assessment return every year. The current cost of class 2 National Insurance (what self employed people pay) is £2.80 per week. As your sole source of income is poker no tax would be due on your winnings but you cannot offset any losses. Edit I have just seen your new post, quite right it is class 3 as you would be classed as someone with no taxable income. The government would calculate how much NI you need to pay although I suspect it is the same as I have quoted. 

The state pension is being simplified and from April 2016 a new flate rate pension of £155.65 per week will be given at State Pension Age. 

As you are a youngster (;) and the state pension is being reformed even further over the next few years it might be an idea to wait and see what the government proposes. To qualify for a full state pension, you now need 30 years worth national insurance records (ie pay national insurance for that time). There are also some state unemployment benefits where the government will give you ni credits whilst claiming benefits for free if you qualify. 

You could get some advice from an accountant or financial advisor but both would want to be paid for their time so probably not worth it. Alternatively, if you want some free help you could contact your local citizens advice bureau and ask to speak to a benefits expert. 

It's good that you are thinking of some form of planning for the future, a lot of poker players cant see any further than tomorrow and dont consider things like pensions/investments. If your future lies in a long term career in poker, then some form of financial planning is prudent imo. 

Feel free to contact me on facebook if you want some further information. You can find me via JJ if necessary!

ACEGOONER

In Response to Re: Advice: poker as sole income/ NI contributions:

Thanks for the responses, yeah i have taken a look, it looks like we fall into class 3 as not actually self employed, AJ on a sidenote you plan on saving for a house and repeat, you reckon you could get a mortgage or would just be saving to buy outright? 
Posted by benc

Don't bank on getting a mortgage unless you have a partner who has an income, poker earnings are not recognisable by pretty much if not every bank. 

Cash is the way I am afraid although I know a few pro's that have suceeded in getting mortgages but I am pretty sure they had huge deposits. If you disclose yourself as a poker player, they will also categorise you as a professional gambler, a lot of mortgage underwriters will not understand about poker being a skill game and class you as high risk. 

benc

Thanks for that info gooner I was planning on going to speak to someone more in the know like citizens advice, thought it would be an idea to tap into the forum and see what other guys have done in the same situation. Noone ever seems to have a clue that i speak to in 'normal' jobs, feel like i'm in the same boat as a drug dealer when it comes to sorting anything like this, Yeah didn't envisage a mortgage would be too realistic, renting a place was hard enough!

ACEGOONER

In Response to Re: Advice: poker as sole income/ NI contributions:

Thanks for that info gooner I was planning on going to speak to someone more in the know like citizens advice, thought it would be an idea to tap into the forum and see what other guys have done in the same situation. Noone ever seems to have a clue that i speak to in 'normal' jobs, feel like i'm in the same boat as a drug dealer when it comes to sorting anything like this, Yeah didn't envisage a mortgage would be too realistic, renting a place was hard enough!
Posted by benc

No problem benc, I am a financial planner (allbeit a corporate/insurance specialist) so if you need some help get in contact.

Citizens advice should sort you out mind!

ShaunyT

i cant offer any info, but i do know George Osbourne is going to anounce changes to NI/state pensions at the begining of April. I think its something along the lines of you need 10 years contributions to geta state pension

GELDY

In Response to Re: Advice: poker as sole income/ NI contributions:

i cant offer any info, but i do know George Osbourne is going to anounce changes to NI/state pensions at the begining of April. I think its something along the lines of you need 10 years contributions to geta state pension
Posted by ShaunyT

He's had to backtrack on his tax grab. 

Sooner you're on the ladder the better to protect your future options. Imho.

Essexphil

Successive governments have failed to show consistency in relation to this. Frankly, it is impossible to say with any certainty how many years NI contributions will be necessary or indeed when most people will retire. However, it IS important to look towards getting as many NI years in as possible.

PS-at present, poker "earnings" are not taxable, but never assume that this will always be the case....

unknown_username

In Response to Re: Advice: poker as sole income/ NI contributions:

Hi Benc Lots of information been posted here some of it is incorrect. Firstly if you want to claim the state pension you would need to register as self employed and then file a self assessment return every year. The current cost of class 2 National Insurance (what self employed people pay) is £2.80 per week. As your sole source of income is poker no tax would be due on your winnings but you cannot offset any losses. Edit I have just seen your new post, quite right it is class 3 as you would be classed as someone with no taxable income. The government would calculate how much NI you need to pay although I suspect it is the same as I have quoted.  The state pension is being simplified and from April 2016 a new flate rate pension of £155.65 per week will be given at State Pension Age.  As you are a youngster (;) and the state pension is being reformed even further over the next few years it might be an idea to wait and see what the government proposes. To qualify for a full state pension, you now need 30 years worth national insurance records (ie pay national insurance for that time). There are also some state unemployment benefits where the government will give you ni credits whilst claiming benefits for free if you qualify.  You could get some advice from an accountant or financial advisor but both would want to be paid for their time so probably not worth it. Alternatively, if you want some free help you could contact your local citizens advice bureau and ask to speak to a benefits expert.  It's good that you are thinking of some form of planning for the future, a lot of poker players cant see any further than tomorrow and dont consider things like pensions/investments. If your future lies in a long term career in poker, then some form of financial planning is prudent imo.  Feel free to contact me on facebook if you want some further information. You can find me via JJ if necessary!
Posted by ACEGOONER

I guessed you would have a very clever answer......

F_Ivanovic

In Response to Re: Advice: poker as sole income/ NI contributions:

Successive governments have failed to show consistency in relation to this. Frankly, it is impossible to say with any certainty how many years NI contributions will be necessary or indeed when most people will retire. However, it IS important to look towards getting as many NI years in as possible. PS-at present, poker "earnings" are not taxable, but never assume that this will always be the case....
Posted by Essexphil

http://www.hmrc.gov.uk/manuals/bimmanual/bim22017.htm

It's enshrined in tax law. Would get plenty of notice if they ever thought about changing it as it would take years to change.

Essexphil

In Response to Re: Advice: poker as sole income/ NI contributions:

In Response to Re: Advice: poker as sole income/ NI contributions : http://www.hmrc.gov.uk/manuals/bimmanual/bim22017.htm It's enshrined in tax law. Would get plenty of notice if they ever thought about changing it as it would take years to change.
Posted by F_Ivanovic

I was referring to 2 separate things. Common sense would suggest that any changes to pension should have many years' notice, due to the nature of pensions. However, there have been many recent changes that have had little notice attached.

Turning to gambling being taxable, with the greatest of respect, that is rather more complex than a 91 year old case. Traditionally, the only thing that was "enshrined" in law was that gambling contracts were unenforceable, but hundreds of years of case law was removed by a statute and a statutory instrument.

Firstly, there have been many arguments as to whether poker is gambling or a game of skill. There was considerable press coverage about this last year, together with speculation re the Government looking to change its position. For tax purposes, it is better (for us) that poker is regarded as just gambling.

Secondly, countries that have introduced such taxes (and there are many) did not all give "plenty of notice", any more than for the various restrictions placed on playing in various parts of the world.

I sincerely hope that there is no change. Failing that, I hope there is lots of notice before such change. However, I would not rely on it! That said, I hope that the recent changes in taxing companies at source makes change less likely