Help employed and self employed

missty25

Hello All,

I currently work 6 hours over a weeked with the NHS and sometimes do 8 hours overtime a week as well approximately every 3 weeks. I am due to go back to college at the end of this month for 2 years studying HND beauty therapy.

My question is this; I am already qualified to diploma level in beauty therapy and am looking to set up going mobile maybe 2 evenings a week and a Saturday and possibly Sunday. How would this work for registering with the Inland Revenue regarding being emplyed by NHS also? Will i need to open a business bank account if so are there any more suitbale to very small businesses? I am hoping to just earn a bit extra pocket money at the moment and build up business for when I'm finished my course. Am I best to maybe make an appointmnet with an accountant/financial adviser?

Any advice or comments would be greatly appreciated, I want to everything correct from the beginning!

Thank you
Missty25

Savvy_Sue

Businesslink is a good place to look first.

It could be worth chatting to a few accountants, but you wouldn't necessarily need to use one for simple accounts as a sole trader.

You would need to register as self-employed with HMRC, and they will send you self assessment forms for any extra tax due on that. You'll also have to pay extra National Insurance, unless your income for s/e is going to be below their threshhold. Talk to them, they're usually very helpful.

PassedAtFailing

Sole traders do not need a business bank account - although they may want to. I should imagine most (if not all) of your sales are going to be taken as cash so I can't see a scenario where a cheque payment (for example) to a business name would benefit you more than a payment to your own name. I would advise you keep your self-employment and personal bank accounts separate though for ease of record keeping.

You have to register as self-employed within 3 months of starting. You can register before but they won't process it until your start date anyway.

You can submit a self-assessment online with HMRC and they'll let you know well in advance when you need to. You basically inform them of ALL income and all outgoings and will calculate your payable tax on that if any. It's not really as difficult as a lot of people seem to make it out to be... well, in my opinion anyway.

Premier_2

Personal bank accounts should not be used for business purposes.

If the bank suspects that is what you are doing, then they have a number of actions they could take ... typically they'll transfer your personal account to a business one meaning you'll be paying business tariffs on all your transactions, even personal ones so best to discuss the situation with the bank.

You may receive your income as cash, but I suspect many of your business outgoings will not be in cash. (e.g. products purchased, payments to HMRC, etc)

Mahmood_Reza

Ensure that you can have a clear paper trail that backs up what you generate via income and spend, whether this is a receipt book, petty cash book and the like. In theory & practice HMRC assume that everyone can verify what they spend and earn. Having a dedicated business a/c means that you can claim bank charges (after free banking expires!), keeps a good separation between personal and business and enables more control. An evolution into becomming self employed is as much a change of thinking as anything else. If you start your business now then there is a stronger likelihood of being able to claim training costs in the future.
In addition, having a separate bank a/c enables you to build up a good credit rating with your bank, if you need theor support at some point this will be in your favour (in theory)