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  • FIRST POST
    • bananaisnotafruit
    • By bananaisnotafruit 30th Nov 17, 2:09 PM
    • 1Posts
    • 0Thanks
    bananaisnotafruit
    Going self employed - where to begin??
    • #1
    • 30th Nov 17, 2:09 PM
    Going self employed - where to begin?? 30th Nov 17 at 2:09 PM
    Hi all,

    New here so not sure if this belongs here or has been done before, but basically wondering how to navigate the whole self employed thing as someone who has no experience whatsoever. I'm 24 and have been working regular jobs, no one I know is self-employed so would appreciate some advice from any who do. Also concerned as to whether I'm in trouble for not declaring before.

    The career field I'm going into is as an artist manager in the music business. I have been receiving money from around 2 years ago every few months - I would estimate under £1000/year or even less from royalties. Is this taxable?

    Also, would i need to register as self employed and also are there any steps i need to be aware of, what are the estimated costs etc. I expect to be making money from music in the next year so want to be prepared but I'm a COMPLETE newbie when it comes to all this so if you can be as basic as possible in you replies, that would help me so so much.

    please no snidey/sarcastic responses please.

    Thanks so much
Page 1
    • 00ec25
    • By 00ec25 30th Nov 17, 2:41 PM
    • 5,592 Posts
    • 4,996 Thanks
    00ec25
    • #2
    • 30th Nov 17, 2:41 PM
    • #2
    • 30th Nov 17, 2:41 PM
    Hi all,

    New here so not sure if this belongs here or has been done before, but basically wondering how to navigate the whole self employed thing as someone who has no experience whatsoever. I'm 24 and have been working regular jobs, no one I know is self-employed so would appreciate some advice from any who do. Also concerned as to whether I'm in trouble for not declaring before.

    The career field I'm going into is as an artist manager in the music business. I have been receiving money from around 2 years ago every few months - I would estimate under £1000/year or even less from royalties. Is this taxable?
    Originally posted by bananaisnotafruit
    it is and was declarable - whether you have to pay any tax on it depends if, when added to your other income, the combined total took you over the tax free allowance that year

    on the assumption it did, then yes you should both have declared and paid tax on it. You can either come clean to HMRC or you can hope they never notice, your choice

    Also, would i need to register as self employed and also are there any steps i need to be aware of, what are the estimated costs etc. I expect to be making money from music in the next year so want to be prepared but I'm a COMPLETE newbie when it comes to all this so if you can be as basic as possible in you replies, that would help me so so much.
    Originally posted by bananaisnotafruit
    you must register as self employed since that is your stated intention. bearing in mind your previous position you should not delay doing so (although technically the deadline is a long way off), it involves 2 things:
    a) you "register" with HMRC the fact you are self employed
    and
    b) you sign up for self assessment (ie submitting tax returns)
    https://www.gov.uk/log-in-file-self-assessment-tax-return/register-if-youre-self-employed

    you will need to learn how to keep your own financial records and also how to prepare a set of accounts from which you can then complete your tax return

    if you set up "now" you are in tax year 17/18 (6/4/17 - 5/4/18) and therefore you will need to file your tax return no later than 31 January 2019

    always remember the cardinal rule of self emplpyment - set aside enough money to pay the tax man !!!! Do not spend what is in your bank if that includes the tax money. Not having the cash to pay the tax is not accepted as an excuse

    realistically you should set yourself up as a sole trader unless you immediately expect your profits (income - expenses) to be well into the higher rate tax bracket (ie >45k) at which point it may be worth considering setting up a Limited Company - but that entails a lot more admin and costs. Best to take advice from a proper accountant before doing a company route

    https://www.gov.uk/set-up-sole-trader

    here is a general summary you may find useful
    https://www.gov.uk/working-for-yourself

    also remember the second cardinal rule of self employment - do not forget that at a point in time you will have to start making payments on account for your tax, so your tax bill will be for an amount that equals all of last year's tax and half of this year's tax

    many people really struggle to understand this and get caught short of cash complaining their tax is "too high"
    https://www.gov.uk/understand-self-assessment-bill/payments-on-account
    please no snidey/sarcastic responses please.
    Originally posted by bananaisnotafruit
    D'oh, you've taken away all the fun of posting
    Last edited by 00ec25; 30-11-2017 at 2:46 PM.
    • Pennywise
    • By Pennywise 30th Nov 17, 3:27 PM
    • 9,442 Posts
    • 17,176 Thanks
    Pennywise
    • #3
    • 30th Nov 17, 3:27 PM
    • #3
    • 30th Nov 17, 3:27 PM
    Most accountants will give a free initial consultation to go over the basics with you (in the hope you'd become a client).
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