PAYE plus Self Assessment

NSN1968

Hi Everyone...

I am employed as a software developer and paid through the normal PAYE system. I also do some wedding photography on the occasional weekend. This started of because I am a keen photographer and some family asked me to do their wedding and has now grown through recommendations to about 3 or 4 weddings a year.

Up to now I have only earned a £200 - £300 so not bothered declaring it. I have now developed a website and am starting to get more weddings and am charging more (£500 each)

I have two questions...
1. As I am now earning more from it (maybe £2000 this year - growing each year) I am going to declare it by doing a self assessment. I would prefer it if my employer didn't know too much about it so my first question is will he find out if I fill out a self assessment and pay tax from my wedding earnings separately?

2. I have bought around £2000 worth of camera equipment which I intend to declare as capital allowance against my earnings. I also want to charge myself for doing the website and put this against tax plus some mileage expenses. The problem is that I will not start earning money until after April 09 as my first wedding is not until May. So, should I fill out a self assessment for this tax year showing no earnings but all the costs so I can carry the loss forward into the next tax year or can I wait until the 2009-2010 tax year to do my first self assessment and claim the equipment that I purchased in this tax year. I would rather wait and do my first self assessment until the 2009-2010 tax year but am I allowed to claim against items and expenses from a previous tax year?

Thanks for reading and I look forward to your advice.

Neil.

fengirl_2

1. You need to register as self employed within 3 mths of starting. By registering from May 09, you are risking the fact that you did not declare the earlier earnings. Your employer will not know anything about your second job - your tax affairs are confidential.
2. You cannot charge yourself for your own labour. (if you did, you would pay tax on these 'earnings') You can claim capital allowances on the equipment in 09-10 - you cannot claim if there are no earnings to set against.
Why not declare the earlier earnings in 08-09 as casual earnings?

NSN1968

Thanks for the reply fengirl.

Any work I did prior to my first proper (non family/friends) wedding in May 09 was just a couple of hundred quid over 3 or 4 years. I know that technically there is a risk in not having declared it.


So looking forward to my first job in May 09, should I register as self employed within the three months and declare any earnings from the tax year 09-10 in my tax return and also show the capital costs in that return; even though I purchased the equipment in this tax year and the equipment cost will be more than my turnover?

Thanks in advance.

Neil

fengirl_2

Yes. You can introduce equipment previously owned into a business at any time. You would probably wish to do this with your car as well.

nzmegs

When I registered as self employed I was told that I could not do so until I had my first actual payment. I guess this is so that you don't register and then never get any work.
As long as May is your first "proper" job then make sure you register within 3 months of receiving payment or completeing the job.

NSN1968

Thanks nzmegs.

I'll wait until the payment is in.