new business advice

bluecorn · 15 April 2008 at 9:33PM

As you guys may already know and Im quickly finding out is how mind boggling it is about setting up a new business.

I am a hobbyist photographer on the verge of going pro. Thats on the basis of I work pt at the moment and can (potentially) earn more doing photography than I will in work (per annum). I dont do weddings etc where the big bucks is but not ruling it out in coming years. I basically do sport stuff and sell to parents of kids involved via internet. I know about the 60k VAT threshold and am miles off that. My stock is my equipment which is already bought and paid for so I wont need to claim for that, I only use a printing firm for prints and then resell onto parents, My out goings is very low. I know if was all setup as business I would claim mileage, internet, website, phone etc etc but Im happy to pay myself anyway due to the fact Ive always had it. Im sure if I claimed for things like that and the 40p mile I would be trading at a loss as I reckon my business outgoings (without a salary) would be circa £100 and my income would be average £80 per week (due to season sports) but the question is, Do I declare it or not regarding tax etc, Im paying tax in my part time work but waht about the photography side of things.

Please help and advise folks, Many thanks

sassybooboos · 15 April 2008 at 10:09PM

is there any one who can recommend a good accountant to you.

The one we used to use when we had our business, told us every thing we needed to know before we even gave him our business. He was really cheap as well and well worth the £275 a year we paid him

fengirl_2 · 16 April 2008 at 6:55AM

You need to register as self employed within 3 months of starting the business. However, if you are not trading with a view to profit, you are not in business and what you are doing is just a hobby.
Go and see an accountant for one-off advice.

bluecorn · 17 April 2008 at 9:52PM

fengirl wrote: »

You need to register as self employed within 3 months of starting the business. However, if you are not trading with a view to profit, you are not in business and what you are doing is just a hobby.
Go and see an accountant for one-off advice.

But I can make profit, A good one too but my point is I make profit on me doing things as it stands now, ie. I dont claim business miles, I dont claim internet, I dont claim equipment. All because these things I would have anyway regardless of my business venture.

If I did claim all the above I would be trading at a loss. So which is right, As I am making money and not claiming the things I can or declare the lot and run at a loss (for tax purposes)

Pennywise · 18 April 2008 at 9:27AM

bluecorn wrote: »

But I can make profit, A good one too but my point is I make profit on me doing things as it stands now, ie. I dont claim business miles, I dont claim internet, I dont claim equipment. All because these things I would have anyway regardless of my business venture.

If I did claim all the above I would be trading at a loss. So which is right, As I am making money and not claiming the things I can or declare the lot and run at a loss (for tax purposes)

If you're paying for such things anyway, they wouldn't be allowable as business expenses - only things that are "wholly and exclusively" are allowable. If you use your internet for say half the time for business and half private, you can only claim half the costs.

You need to register as self employed as you are trading. This is more than a hobby as you are charging customers for your services regardless of whether you are making a profit or not. Once registered, you need to make proper claims for the allowable expenses - if that turns into a loss, then you can claim the loss against tax on employment income and claim a tax refund.

bluecorn · 18 April 2008 at 10:48AM

Got you, Thanks alot. Now Im understanding it, I am off to see the local business link today as it happens but wanted to be a little cled up, Thanks

Zazen999 · 18 April 2008 at 11:42AM

Hi
i would recommend the [very dry but] extremely informative self assessment sessions run by the local tax office. You can get alot of info about what you can and can't claim against; and ways of keeping your records.

If you are getting an income, even if it is on top of your other job; then you really should declare yourself self employed; even if you offset your expenses and don't make a profit and don't pay tax, it makes sense to do it sooner rather than later.

If in doubt, the tax office can help determine whether it is a hobby or a small business.

new business advice

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