Sole Trader Income

henrygregory

Hi, I was recently made redundant from a job I worked at for 2 days per week all year round.

I set myself up on HMRC as a Sole Trader and I have been trading two days per week since.

I still work 3 days per week as a civil servant and I am payed as a normal employee(not self employed). From my council work, I earn £1493 before tax and £1018 after tax per month.

For my self employed work, I am currently charging £1392.29 per month. I am not registered for vat and have provided my UTR number to all of my customers. I have been banking the 1392.29 each month in a sperate bank account and have not touched the money. When I come to fill in my self assessment, can anyone give me an idea on how much I will take home after paying my tax bill for my self-employed work?

Any help would be really good as I am completely new to all of this.

Suarez

That's a very specific amount you are getting every month from self employed work.

You will take your £16,707 from self employment and deduct any allowable expenses leaving your profit then pay 20% on this.

There may be other adjustments you can make depending on your circumstances. Capital allowances, work from home relief etc.

Suarez

And you don't need to provide your UTR. Just invoice them.

henrygregory

Hello, thanks very much for your posts. Yes it is very specific amount as I have service level agreements for all three of my self employed customers. Though, I do earn a little extra from time to time as they may need me for extra time which is not contracted in my SLA. I just do them another invoice detailing this. All of my customers are schools so I thought I best had provide them with the UTR as they have quite strict rules on who can work for them, don't think they can just hand out cheques each month as I could be doing it cash in hand.

Do you think it is worth me getting an accountant? I am completely new to this and don't want to end up messing up or paying far too much tax. I have been keeping receipts for anything I use or buy for work such as my mobile broadband for my work iPad, the digital camera I purchased for my self-employed work and I have also kept a log of the miles I have done for my self employed work from home, to the job and back again.

I have also kept a log of my invoices each month on a neat and organised excel sheet.

phill99

An accountant will cost around £250 a year. It will be the best £250 you spend and they will save you more than their fee.

If you are not sure what you can claim for, then you will more than likely end up paying too much tax. There are allowances which, to you, are not obvious but an accountant will be very familiar with.

No body knows how much tax you will pay as we don't know your level of business expenditure. This is were an accountant will be invaluable.

ostrichnomore_2

You'll pay 20% tax on your profit.