Tax on self employed earnings alongside a full time job

emilyka

Good Morning,

Note to board guide- please move this thread if it is in the wrong place!

I am looking into the possibility of working as a sole trader alongside my permanent full time job. I would be earning a small amount (maximum £100 a week) and was wondering how much tax I would have to pay and how/ if it would change the tax on my full time job?

For example, when I register as self employed will I get taxed as a 2nd job for the wage packet on the FT job?

Thank you very much for reading- I'm clueless when it comes to tax!! :mad:

lozza1985

I work full time, and am registered as self employed for avon. It hasn't affect my tax on my full time job. As for your self employed earnings - you will only pay tax on your profit, so hang onto receipts etc for all costs you incur, so that when you complete your tax return you won't need to pay as much tax. If you ring the helpline I found they were really helpful, they sent me out a form to excempt myself from paying NI on my self employed earnings.

fengirl_2

If you are a basic rate taxpayer, you will pay 20% tax on your profits (not your income).
Your main job will not be affected.
You register as self employed and complete a self assessment at the end of each year. The tax will then be payable direct to HMTC by 31 Jan and 31 July following the end of the tax year. Class 2 NIC is payable by monthly DD.

emilyka

Thank you both very much, this is really helpful. I was starting to worry i would get taxed so badly that it wouldnt be worth it! I can't afford to give up my full time income and I want to up my income to allow me to save without the tax man taking the mick! I already feel like I get taxed too much :mad:

lozza1985

I know what you mean - the tax office does run free half day courses as well to help with knowing what you can/can't claim for as expenses, however as they are only held during the week I haven't been on one, as not using a days holiday for it!

emilyka

lozza1985 wrote: »

I know what you mean - the tax office does run free half day courses as well to help with knowing what you can/can't claim for as expenses, however as they are only held during the week I haven't been on one, as not using a days holiday for it!

Agreed! Maybe they should do some sort of web seminar?!

lozza1985

When I asked if they ran any at a weekend - the woman sounded very surprised, and said no because their isn't the demand for it! Even just a leaflet to post out would be helpful lol!

fengirl_2

You will find the Cutting Tax and Small Biz forums on here helpful for general questions and your local Business Link will also help.
The HMRC seminars are good for the basics (I used to run them), but dont forget that the staff there will be towing the party line and will not have the experience of Inspectors of Taxes who have the authority to cut corners and allow deductions which are not strictly by the book.
The essential is to keep bomb proof records of all your income and expenditure, backed up by receipts and invoices, as you go along. Don't expect to be able to produce a set of accounts at the end of the year from scribbles on the back of a fag packet. Bank EVERYTHING, reconcile your bank monthly and ask for help if needed.