Novice - tax advice needed if poss

Yorkshirefella

Hi. Any help would be gratefully received. I woek full time and tax is deducted as PAYE along with my National Insurance. I am part of a team setting up a website which will generate an income. There are three of us involved in the site and the income will be split three ways. The webmaster has his own limited company so he will send me a cheque monthly along with a letter confirming the income and the split. At this stage I don't know how much this will generate but I appreciate I will have to pay tax on it. I have received conflicting advice from well-meaning people about what I should do. Some have said all i have to do is keep a tally of the the payments generated by the website and do a self assessment and pay the tax on it that way...others have said I could deduct expenses from what I have to declare - but by doing this would I have to be registered as a business? I can't do that cos I am in full time employment. I am quite happy to do the self assessment thing each year if all that's required but any guidance would be appreciated. I tried the Inland Rev website but couldn't make head nor tail of it and when I ring I just get told it's too busy and to call back. Naturally I wanna do it all by the book. thanks.

fengirl_2

By receiving income from this website, you are in business - it does not have to be a formal thing with a trading name, etc - anyone who receives payment for work done on his own behalf is in business. It does not matter that you are also in employment - you can have as many jobs/businesses as you want.
What you have been told is correct - you need to keep accurate record of all your income and expenses in connection with this business. At the end of each tax year, you will complete a self assessment and pay the tax due to HMRC in two lump sums. You will also have to register as self employed within 3 months of starting to get money from the website and will be liable to pay class 2 NIC (about £2.50pm) by DD, which HMRC will sort out for you.

lucid2008

Every month send him an invoice for the amount you will know you are getting.He gets a copy and you keep a copy for your own records.