Self-Employment Help

BulletCraig

Hi. I'm looking for some advice regarding self-employment if possible. My sister is still caring almost full time for her 2 year old so finding a job that will accommodate the hours she can spare is near impossible. By working 16 hours or more per week she'd be entitled to tax credits she doesn't currently receive so it would definitely be to her advantage to work if possible (the additional tax credits plus income would outweigh the loss of housing benefit that would occur due to her working). She has been offered a few different cleaning jobs that combined would total almost enough hours for her to qualify, and she thought about topping the hours up by re-selling clothes over the internet. However as they're all cash-in-hand she would need to declare herself self-employed. My questions are:

1. Are my above assumptions correct regarding her declaring herself self-employed?

2. What backup/evidence of work should she be keeping if she goes ahead with the idea?

3. I realise she would have to submit her own tax return each year. Am I right in thinking as her total annual earnings would be way below her annual allowance she would have no tax to pay? What about NI? Do her tax credits count towards her income here?

4. Are there any other things she needs to think about before doing this? Are there any other implications of being self employed?

Thanks in advance.