Would I have to pay tax/file a tax return?

ernie-money

Hi all,
Hoping for some advice... I have always been a PAYE employee, so have never had to file a tax return for myself. I have however got 2 friends who are self employed, and I always do their tax returns for them. (Very simple stuff, just adding up their expenditures etc and filing it online) The other day one of them said that really he should be paying me for it, not a huge amount, but say 50 quid the trouble, no big deal to him, as he would be able to deduct that amount with his expenses anyway. I just wasn't sure if there's a threshold for additional earnings when you are PAYE, or how it works?
I have no other additional earnings as such - a few quid from online research and cashback companies, and a tiny bit of interest on savings, but literally pennies, so if I was to earn a hundred pound a year from this, would I have to file a tax return, or how does it work...? Basically I'm trying to work out if it would be worth the hassle for just a hundred pounds.
Would be very grateful for your help!

InsideInsurance

If you are working as self employed (effectively a book keeper by the sounds of it) then you would have to register with HMRC and deal with both Class 2 NI and your own tax return.

There is no threshold for having to register or doing tax returns, even if you make a loss you have to submit one, but if earnings are low you can claim exception from the class 2 NI.

Before moving into the world of consulting/ contracting I was also both an employee and self employed. For the last few years my self employed life was making peanuts but I found when doing my tax return it almost always gave me a refund.

ernie-money

InsideInsurance wrote: »

If you are working as self employed (effectively a book keeper by the sounds of it) then you would have to register with HMRC and deal with both Class 2 NI and your own tax return.

There is no threshold for having to register or doing tax returns, even if you make a loss you have to submit one, but if earnings are low you can claim exception from the class 2 NI.

Before moving into the world of consulting/ contracting I was also both an employee and self employed. For the last few years my self employed life was making peanuts but I found when doing my tax return it almost always gave me a refund.

Thanks a lot for that! I hadn't even thought of NI contributions...
Food for thought, I'll just have to decide whether I can actually be bothered or not!

heretolearn_2

I'm not trying to be funny but if you have no idea of how taxation works, I really don't think you should be charging people to do their tax returns. Doing a favour for a friend is one thing, but if you charge for the service and then make an error/omission that results in their losing money/paying too much tax/gaining penalties, how are you going to deal with any liability you may incur?

If you are going to charge for a service, any service, you need to make sure you know exactly what you are doing.