Tax - how much will i pay

makemesumdosh

I am currently employed on a full time basis in the building industry with a company pension scheme. My basis salary is 20K.


I am always being asked to do private work which I have to decline as only my weekends are free.


I have the option of going part-time (3 days a week) which will reduce my salary to 12K in April. I know this will mean my tax bill will very low.


What I need to know is if I buy a van, £2500, kit it out £500, and start trading as a business what are my tax issues and can I offset my set up costs.
i know that most people in my trade who i know earn double to what i earn being employed.

Savvy_Sue

When you say 'start trading as a business', you need to be clear about what you mean.

If you intend to set up a limited company you should find a couple of accountants and get some advice from them: there are advantages and disadvantages but it is definitely more complicated.

If you're going to be a sole trader - ie just you, the van and the tools - the advice above still stands.

Yes, you can usually offset your setup costs, but vehicles can be more complicated.

And remember, those earning double because they are self-employed are not paid for holidays, and have to promote themselves to get work, pay for insurance, buy all their own tools, sort out their own pension etc etc etc.