13 year old artist - tax situation?

chubsta

I am self-employed as a programmer and I need some artwork for a commercial project (an app for the iPhone) - the likely source of this artwork is going to be a friends daughter, who is very talented but only 13 years old.

The likely payment will be in the region of £500.

I will of course be accounting for this payment in my records, my question is does she need to declare it in any way? I am aware that minors are not allowed to be employed in certain areas (sale of alcohol, factories etc) but often read of teenage coding-genius' who make a mint from programming so i guess this isn't really any different...

I seem to remember that you do not need to pay tax until you are 16, and the payment would be well below the threshold anyway, but would she need to be 'registered' anywhere, or would she just be able to treat it as bonus pocket-money?

('keeping quiet' about it if it does have to be declared is not an option as despite hating paying tax i like the fact i can sleep at night without worrying about it!, and also, teaching a 13 year old about the responsible way to do business is also a very good idea i feel...)

Any and all advice welcomed...

Valli

She has a tax allowance just like everybody else. So she can have the money no problem.
She can contact the tax office, declare it as earnings and she'll be fine. If she's going to do any more work for you that might be a good idea.
Check the Directgov website but IF her parents are on TaxCredits then she probably does need to decalre it as her income, not theirs, then it won't affect them.


You're probably thinking of NI with the '16' bit.

If she extends this and does become a freelance artist she will be able to claim expenses too (ie costs of materials) and offset it against her income, like you do!