Paying tax on additional income

JoJo_Sparkly

Can I get some advice. I am currently employed and pay tax through PAYE. I am about to take on additional work as a consultant/inspector and will be travelling, staying away from home in this capacity.
Having never paid tax in any way other than through PAYE, I really don't have a clue what I need to do and what I can claim against tax.
I'd really appreciate any advice on records to keep and what I should do...
Many thanks

PlutoinCapricorn

First read through the relevant parts of https://www.businesslink.gov.uk

You need to register with HMRC as a sole trader as soon as you have some actual work, not in advance just hoping that you will get some!

Invoice your clients, keep receipts, keep records of income and expenses. Think about what insurance you will need. Put aside around 1/3 of what you earn.

You will need to submit a tax return for the year 2012/13, sometime after April 6th 2013. HMRC do free courses on completing tax returns.

mildred1978

JoJo_Sparkly wrote: »

Can I get some advice. I am currently employed and pay tax through PAYE. I am about to take on additional work as a consultant/inspector and will be travelling, staying away from home in this capacity.
Having never paid tax in any way other than through PAYE, I really don't have a clue what I need to do and what I can claim against tax.
I'd really appreciate any advice on records to keep and what I should do...
Many thanks

You'll need to register as self employed (in addition to PAYE) with HMRC.

You'll need to keep records of any mileage undertaken in your own car, plus receipts for anything purchased solely for the purpose of your work (travel tickets, stationery, food, hotels, etc).

Will you be doing any work from home?

JoJo_Sparkly

mildred1978 wrote: »

You'll need to register as self employed (in addition to PAYE) with HMRC.

You'll need to keep records of any mileage undertaken in your own car, plus receipts for anything purchased solely for the purpose of your work (travel tickets, stationery, food, hotels, etc).

Will you be doing any work from home?

I'll will be travelling around the country so I guess petrol and some costs towards car (if there a formula for mileage that takes into account wear and tear on vehicle?) hotel stays and will need to eat I guess.

Some work will involve me completing paperwork - reports etc as a follow up - can I also include costs for laptop? print ? Phone bill etc?
How do I show this separate from my own personal use e.g phone use etc

horsechestnut

There is a standard milege allowence of 45p per mile (it reduces after a certain number of miles, but I can't remember how many, as I never reach it, but it is quite high. Check with HMRC) That is to include all running costs as a self employed person.
You can claim £3 per week for home office costs, as you most likely do your paper work in a room that you would use anyway. That is to include your phone (unless you have a separate dedicated line used only for business), electricity, heating etc.
You can claim for any office equipment such as computer/laptop, pens, paper, printer etc. I did claim for my SatNav as I didn't need one normally, and was able to claim this. Any repairs/maintenence to your equipment.

mildred1978

You can only claim a laptop if you buy it solely for the purpose of working and nothing else.

You can claim £5 flat rate subsistence for any overnight stays (it's to cover phone calls etc).

45p per mile for the first 10,000 miles in your car which covers everything.

bankhater_1965

you will also have the added bonus of being able to pay your self employment tax (if any) through your PAYE , remember you wont pay anything for the first year regards to self employment income tax

bankhater_1965

horsechestnut wrote: »

There is a standard milege allowence of 45p per mile (it reduces after a certain number of miles, but I can't remember how many, as I never reach it, but it is quite high. Check with HMRC) That is to include all running costs as a self employed person.
You can claim £3 per week for home office costs, as you most likely do your paper work in a room that you would use anyway. That is to include your phone (unless you have a separate dedicated line used only for business), electricity, heating etc.
You can claim for any office equipment such as computer/laptop, pens, paper, printer etc. I did claim for my SatNav as I didn't need one normally, and was able to claim this. Any repairs/maintenence to your equipment.

15% off your household bills gas elec etc to offset your profits etc

mildred1978

bankhater_1965 wrote: »

15% off your household bills gas elec etc to offset your profits etc

Erm, what???!!! :rotfl:

bankhater_1965

mildred1978 wrote: »

Erm, what???!!! :rotfl:

sorry i ment to say 15% of the total for the annual cost of gas elec etc can be claimed for the 1 room office for self employment or am i incorrect on this figure , this is the figure i have in my head ,my account will no

mildred1978

bankhater_1965 wrote: »

15% off your household bills gas elec etc to offset your profits etc

bankhater_1965 wrote: »

sorry i ment to say 15% of the total for the annual cost of gas elec etc can be claimed for the 1 room office for self employment

That depends on how many rooms ( excluding bathrooms) there are in the house and 1 of them being an office and nothing else.

To claim 15% you'd need a dedicated office and 5 other rooms.