A fairly simple self assessment question.

DoingSA

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morgani

Your earnings need to be the gross amount. The 'payroll fees' are expenses and should be claimed in the expenses section. The tax deducted then also goes on the form (pretty sure it is the final box on the self employment short pages).

If you did incur expenses in relation to your self employment such as business travel, business phone costs, working from home, advertising, stationery, tools, protective clothing, etc then you really should claim these as they will reduce your tax and while maybe not important in your low earning year they may be in future years and not having claimed them before may cause hmrc systems to flag up irregularities.

morgani

I think you may be over complicating things.

ignoring the payroll company you would have earned say £100. Due to not being registered you would have had £30 deducted leaving you with £70.

The £30 gets entered as tax deducted.

now lets consider the payroll charges. These get entered under expenses separately. Therefore your gross income will show correctly and therefore the tax appropriately too. You may then have other expenses also.

comeandgo

As explained to you the payroll costs are your expenses so you enter that as an expense and it will be deducted from gross earnings and you are taxed on net profits.