Tax situation with Occasional Work

sparksfly

Hello all,

I retired at 60 with a private pension of about £12000. I don't yet get a State pension.

I would like to do some occasional work (programming) for different companies who will no doubt want to pay me by cheque and also claim for my costs on their accounts.


I only want to do the odd spell of work and don't really want the hassle of registering as self employed and have to submit accounts etc. to HMRC.

I only expect to do about 4/5 jobs a year for a total of about £1500.

Is there a simple way I can legally pay my tax without the hassle?

A friend told me that there are companies that will accept payments from your customers, 'employ' you and pay your PAYE tax after they have taken their commission. Has anyone heard of this sort of scheme and is it a worthwhile option?


Thanks

Stef

Ypaymore

Tax Forum is here Stef http://forums.moneysavingexpert.com/forumdisplay.php?f=22 probaly best place to raise this question.

gb12345

sparksfly wrote: »

A friend told me that there are companies that will accept payments from your customers, 'employ' you and pay your PAYE tax after they have taken their commission. Has anyone heard of this sort of scheme and is it a worthwhile option?

They are probably talking about umbrella companies, which is what some IT contractors use for their "employment" if they don't want to go the Ltd company route.

Not quite sure how it would work out for occasional jobs as they are more geared up to regular income from multi month contracts.

tyllwyd

I'm self-employed on a small income, and to be honest it isn't much trouble - I would imagine that you would have to give the same information to an umbrella company as you would to HMRC so it wouldn't save you any time.

Registering as self-employed is easy, you just need to contact HMRC. After that, you need to keep some simple books with records of money in / money out. If you do your self-assessment tax online, you need to register in good time to get it all ready to go, but the actual form is easy enough to work through, and at a low income level all you need to give is total profits and total expenses, you don't need to detail each job.

That's a very simplified summary, but what I am trying to say is don't be afraid of it, it really isn't that difficult once you get started.

sparksfly

Thanks all for your helpful advice.

I think I'll have to bite the bullet and get some info from HMRC about registering as Self employed.

Can it ALL be done online, including the actual registration?

Thanks again

Stef

tyllwyd

Have a look here
http://www.hmrc.gov.uk/selfemployed/register-selfemp.htm

BTW if you haven't started working yet, you might want to consider waiting a few days for the new tax year before you register, because that will give you longer before you need to fill in your first tax return and pay your first bill.

But if you want advice from more knowledgeable people, try the cutting tax board here, the people who post there know a lot more about it all than I do.

gb12345

There is another point to consider, which is whether your clients are happy to work with a sole trader.

My OH did the occasional translation work for some fairly large companies and they refused to work with her as a sole trader - so she had to put everything through the Ltd company that I was using for contracting.

sparksfly

Thanks
They are good points about registering after the start of the next Tax Year and the views of large companies dealing with sole traders.

I specialise in developing low cost Microsoft Access applications for small businesses and I have two definite clients wanting me to do work for them, starting next month.
Although I would welcome work from large companies (I used to work for BT as an Access developer), my main target is small local businesses.

Thanks again for the help and advice

Stef