I have not registered as self employed

1984student

This is all so helpful. I am beginning to see that my crime is not nearly as bad as I had dreamed it up to be.
Okay, so first step... call HMRC and register as self employed

"They will just want name, NINO, address, trading name and address (which for actors would be the same) and start date"

- Would the start date I give be the day I first worked for this company back in July 2011 or would it be the day I call up. I am assuming it will be the 2011 start date which will lead to me receiving the letter asking me to complete a tax return for that year?
I will then tell them how much I earned at this company between the 6th of April 2011 and the 6th of April 2012 (which may be less than £2,000). I will have no way of showing them what I spent on travel, clothes for my job etc but that wont be needed as I won't have earned OVER the amount you are entitled to earn tax free?

They will then calculate how much I owe for N.I contributions and I will have to pay that and most likely a fine for not declaring all this. Am I right?

Then...

''2) When you complete the tax return for 2011/12 (I advise doing this online for many reasons) you just give totals. You do not need to supply any records, although it is best to have supporting evidence just in case. There are boxes where you can explain anything that might trigger them into enquiring into your affairs''

These totals, that is totals of what I have earned in the tax year beginning April 6 2012, because I will have dealt with the outstanding tax return of 2011 by that time?
The supporting evidence will be all my receipts for travel etc that should start collecting as of now?

I'm sorry for such elaborate questions, I know you're not here to explain the whole tax system to me, but I think I am just beginning to understand what I need to do...

PlutoinCapricorn

The start date is the first day that you worked for the company.

To repeat, at registration you will not be asked for the company's name or your earnings - or any details about expenses etc. They just want the basics. If you register online, you have no need to talk to anyone and can then wait to see what demands they send you re NI back payments and about the late registration. I registered over the phone, but there may be a box where you can explain why you registered late - just say that you were not sure that there would be much work and you knew that you would not earn enough to pay tax.

themull1

print off cwf1 form from https://www.hmrc.gov.co.uk thats for registering as self employed, if you want to claim low earnings fill in CF10 for the 12/13 year, its self explanitory, send everything to self employment services and they will register your self employment and give you your small earnings certificate if your earnings were low, they then send form cwf1 to be registered for self assessment, then you will receive your utr number.

themull1

when they check the form, if they decide you're not classed as self employed, they will contact you.

PlutoinCapricorn

It is best to deal with this one step at a time. Get registered and deal with the past: back payments of NI and possible fine (let's hope not). Your income and your records are not relevant yet! Be sure to save the letter you will receive: it has a reference number Unique Tax Reference or UTR that you will need. Scan it, copy it, get a file for tax paperwork.

You need to decide whether or not to pay the Class 2 NI as from now on: as another poster said, you could claim exemption but you may want to pay it to get benefits.

Once registered as SE, the next step is to start preparing your figures for 2011/12.

I advise registering with HMRC's online tax return submission service once you get your UTR.

PlutoinCapricorn

I see that things have changed since I registered as SE: you now get an online HMRC account set up automatically now!

http://www.hmrc.gov.uk/selfemployed/register-selfemp.htm

Savvy_Sue

1984student wrote: »

* I might add that the periods in which I wasn't working for this company I was either unemployed or working as an employee for another company where my tax and national insurance was paid by that company.

I think it's worth asking now how much you earned as an employee in the 2011-12 tax year, because you need to add all your sources of income together to check whether or not you're liable to pay tax. This information will be available on your P60 if you were employed at the end of the tax year; your P45(s) if any employment finished during the tax year; or your final payslip from any employer each tax year.

If you were paying tax, what tax code was being used?

Queries

Dear 1984student, If you are on a low income then you can apply for NI -(National Insurance 2 exemption, due to low wages). Also, a thought for you, if you are classed as self-employed, what expenses/purchses can you chargeback -business wise? For example, do you need to get a taxi to work (too early) or a bus? Keep all receipts and off-set it against what you earn . For example: Gross Sales (earnings) less purchases/expenses gives you a Net Profit.

PlutoinCapricorn

Good morning 1984Student. I hope that you were not too overwhelmed by the amount of advice and information that you have been given.

There is a learning curve for the newly self employed, but you only register once and the first tax return is the worst. Ignoring the problem is the worst thing that you can do, but being late is not very serious in your case because of the low earnings. You can get free courses from HMRC on keeping records and completing the tax return, some via webinar.

If I were in your position, I would register online and wait and see what they say about the late registration. I would probably NOT claim exemption from paying Class 2 NI, which will mean paying a backdated bill. You will get a bill and a Direct Debit form for future NI payments - also the claim form.

While waiting, I would get TWO folders and set up TWO spreadsheets: one for each tax year involved. Do not confuse the two years.

2011/2012 is the year for which the return is still open: Jan 31st 2013 is the final deadline (but if you have no tax to pay again being late is not so serious). This seems to have been a 'mixed' year for you so you will need to sort out all sources of income and the totals. We can help here. Expenses ARE important, but they can't be used to reduce the tax payable if your income is very low.

Why not take the first step, and come back and let us know how you get on. THEN we can start thinking about the tax return!

Trad3r1

If I trade as a profession is this taxable? Even though what I'm trading (Binary Options) isn't taxable?