Starting up Self-Employed. Is my ideas on NICS/Tax correct? help please

leanne88

Hi,
I am starting up as self employed next year.
As a make-up artist.
My profit is going to be at £4,000 for the year most likely.
I definitely don't think over that amount.

Am I right in thinking the following?:
1. I can become exempt from paying Income tax because I don't hit the personal allowance.
2. I can become exempt from paying Class 2 because again I don't hit the personal allowance.
3. Is it possible for me to become exempt from paying Class 4 because again I don't hit the personal allowance.

Is that all correct?

And this also means my self assessment will be easy, right?
I'll need to keep records of my earnings, expenses, my receipts, invoices.

Thanks!

fengirl_2

1. Yes, provided you have no other income.
2. Yes
3. Yes.

Yes, keep accurate records of all your income and expenditure and make sure you can justify that level of profit if challenged, ie someone else is subsidising your living costs.

leanne88

fengirl wrote: »

1. Yes, provided you have no other income.
2. Yes
3. Yes.

Yes, keep accurate records of all your income and expenditure and make sure you can justify that level of profit if challenged, ie someone else is subsidising your living costs.

Thank you for your help

So I wouldn't need to put by any money for taxes?

How would I justify the level of profit if challenged? By showing them my invoices? Or?

And yes this will be my only source of income. I hope my business to grow though as time goes on

fengirl_2

One would expect that yu would keep accurate records of income and expenditure, including copy invoices and receipts, etc. Good practice to have a bank account for the business.
What I meant by justifying your profit is being able to show that either you could support yourself on £4k a year, or that someone else is doing so.