How do i declare my self self employed as I want to start a small Internet business.

AndiW_2

I want to start up a small internet business but I haven't got a clue what I need to do to declare my self self employed. I know I need to pay tax, vat but not sure on what else I need to do or how to do it. Is there anyone with any experience in this field who could help me as I haven't got a clue where to start. Thanks

steve1980

https://online.hmrc.gov.uk/shortforms/form/CWF1ST?dept-name=CWF1&sub-dept-name=&location=40&origin=http://www.hmrc.gov.uk

Simples.

pitkin2020

Please don't take this the wrong but as intended to offer some advice. Starting a business isn't simply a case of becoming registered and away you go. If you don't take some time to fully understand what is involved you could be setting yourself up for a big fall especially financially. Knowing that you need to pay tax is totally different to knowing what is claimable as expenses to reduce your tax liability and what isn't. Why do you need to pay VAT?? Look at what your likely to be turning over, and be honest not just what you want to turnover and see if you need to become VAT registered or not. There are a lot of pros and cons of becoming VAT registered from the start, make sure you don't become VAT registered just because you think you need to but rather because it makes business sense.

Steve has given an excellent link on how to become registered, good luck with your venture!!

toffe

you have 3 months to notify HMRC from when you start trading, i'd advise you take this time as you never know which way a new venture will go especially if it's your first.

you don't need to register for VAT untill you turn over, or it becomes obvious you are going to turnover, £60,500 in any one tax year (i think that figure is correct but its around that somewhere) and it is an offence to charge vat when you are not vat registered.

not having to charge vat can be advantagous in the early days as you can be cheaper than your competitors so don't rush in, register for vat when you need to.

when you do need to register for either it's simple, can be done online and is just a case of notifying the HMRC so that they know to send you out tax returns and pursue you if you don't file them.

don't worry too much about knowing what expenses you can claim, just think to yourself everytime you buy or pay for something, "is this business related?" if so make sure you get a receipt and keep it somewhere safe, the best thing to do is then turn all of them in to an accountant at year end, a good accountant usually pay's for themselves several times over by reclaiming expenses you would never have known you were entitled to so they are a worthwhile investment.

Savvy_Sue

Another useful site for new business starts is businesslink, pick and choose what is relevant to your business model, get pointers to what might be your best business model, etc etc etc.

steve1980

VAT threshold is circa £76,000, not £60,500 as previously posted.

antrobus

toffe wrote: »

you have 3 months to notify HMRC from when you start trading, i'd advise you take this time as you never know which way a new venture will go especially if it's your first....

Technically speaking you are supposed to notify HMRC "as soon as possible". There is no specific three month window, it's rather the case that the fines start kicking in after three months.

Apart from the hassle of having to complete a self assessment return, and the likely payment of a couple of months NIC, I can't see much of a downside to registering a business that crashes and burns in less than thirteen weeks. The risk of forgetting all about it should the business actually work would be more significant.

Savvy_Sue

antrobus wrote: »

Technically speaking you are supposed to notify HMRC "as soon as possible". There is no specific three month window, it's rather the case that the fines start kicking in after three months.

Apart from the hassle of having to complete a self assessment return, and the likely payment of a couple of months NIC, I can't see much of a downside to registering a business that crashes and burns in less than thirteen weeks. The risk of forgetting all about it should the business actually work would be more significant.

I think this is especially true if it's the kind of business which is NOT going to have a massive profit in the first year, I can never remember what the current figures are, but it used to be something like £5,500: less than that and you can ask for a Small Earnings Exemption on the NI conts. So, you're then left with the self assessment return to do, and a year to work out if this one's going to fly or not. If you realise your profit is going to be a lot higher than that limit, you need to tell HMRC pronto.

Obviously if you're going to be in VAT territory straight away that's unlikely to apply, but VAT is based on turnover (ie money coming into the business) not profit, so unless your business model has advantages in registering for VAT before you actually have to, then that's unlikely to apply.

martindow

Two other consideration. It is not clear if you are currently employed or not. An employer may well have put clauses in your contract of employment that could create problems for you if your web site is offering the same sort of items or services. If you are receiving benefits of some kind you need to find out the implications of having some income.