Sole Trader Estimate

greensalad

I'm a fairly new sole trader. I have been working for myself for 3 months and invoicing my single client directly. I need to sort out my sole trader status (I'm aware I should have done it earlier) but I'm a bit lost on how to estimate my tax bill as I'm very new to this.

I earn £500 standard rate per month from the client.

I also have travel expenses paid (train tickets, anything from 1-5 trips a month and to various locations.)

I'm given £30 allowance to spend on materials for my role which I charge on my invoice.

I have occasionally worked longer days/events outside the remit of my main role for which I agree a rate case-by-case with my client.

This means I could be invoicing anything from £530 - £1000 a month.

I'm struggling on working out my tax bill estimate. I want to set aside an amount in a savings account to pay my tax bill next year as I don't have the facilities to pay it outright. But how do I know how much I will pay?

I have a full-time role elsewhere for which I earn £22k (employed, not freelance/sole trader).

Also, where does claiming tax back come into things? I have to use my internet and electricity to complete my role, which I do in my own home. So is there anything to be done there? Are there any more things I can do? (Obviously if I can squeeze a little more out of this it would be great!)

AbbieCadabra

i can't help on your tax estimate but are you sure this other role is self-employed? sole client, do they tell you where & when to work? hopefully there's no issues, but best to check as it's not you or the client that decides your status, it's HMRC.

Bravestar

greensalad wrote: »

I'm a fairly new sole trader. I have been working for myself for 3 months and invoicing my single client directly. I need to sort out my sole trader status (I'm aware I should have done it earlier) but I'm a bit lost on how to estimate my tax bill as I'm very new to this.

I earn £500 standard rate per month from the client.

I also have travel expenses paid (train tickets, anything from 1-5 trips a month and to various locations.)

I'm given £30 allowance to spend on materials for my role which I charge on my invoice.

I have occasionally worked longer days/events outside the remit of my main role for which I agree a rate case-by-case with my client.

This means I could be invoicing anything from £530 - £1000 a month.

I'm struggling on working out my tax bill estimate. I want to set aside an amount in a savings account to pay my tax bill next year as I don't have the facilities to pay it outright. But how do I know how much I will pay?

I have a full-time role elsewhere for which I earn £22k (employed, not freelance/sole trader).

Also, where does claiming tax back come into things? I have to use my internet and electricity to complete my role, which I do in my own home. So is there anything to be done there? Are there any more things I can do? (Obviously if I can squeeze a little more out of this it would be great!)

Sounds like you need an accountant to assist you

ricky9

Self-employment and HMRC what you need to know

Whether you have been self-employed for a while or have recently started, there are some important things that you need to know about.

Keeping accurate records for example is important as you use these to fill in your tax return, claim tax relief on expenses and know if your business is growing.

Here’s some help that both new and existing businesses found useful:

• Find out about business expenses by joining our online presentation Business expenses for the self- employed on Saturday 17 May at 10:30. Register here: www3.gotomeeting.com/register/934257846
• Join our online presentation about tax, National Insurance and the benefits of good accurate record keeping when you’re self-employed on Tuesday 27 May at 19:00. Register here: www3.gotomeeting.com/register/435764318
• Make sure you claim the right amount of business motoring costs by watching our YouTube video: Motoring Costs
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