Undeclared earnings, with a full time job involved

Grap3fruit

Hi there,
I work full time, M-F 9-6. I am an apprentice, earning around £1000 monthly so around £12k per annum. This is £1000 over the personal allowance, therefore I will be taxed on that extra 1k by 20% (if I'm wrong please correct me).
I used my money to invest in starting a small business on the side. Initally spent around £200, now I am earning (on average) £212 monthly after a few months after starting my small business/service. This is gross income. My outgoings to pay for services, webhosting and that sort of thing is around the £140 region. So, in reality, I am earning probably no more than £70 a month in direct profits (although this DOES fluctuate, my most in one month was around £220 profit). I know this really isn't a lot of money, and as it's all online (everything I own, including the webhosting, is located in France/Spain.)
I've recently had a bad customer (this all started around 2-3 months ago) who has been ridiculing the business, spreading lies, and really trying to make my service have a bad name. He had a bad experience with us, but has blown it way out of proportion and 95% of the problem is him and his family directly.
I tried resolving the issue, but he took to the net. He then started posting on Facebook and Twitter (on our pages) bad reviews and such. I battled this (in a mature and professional way) providing proof of his lies and showing the truth, so that potential customers can understand how this issue has come to be.
About a week ago, he started writing more on the social networking sites and I became frustrated and told it straight, posting more and more proof to protest his lies. He then got super defensive on both himself and his family, and decided to post what school I went to (easily found online with my name, not a major issue anywho), what my girlfriend and mothers name was, other family members, and basically just loads of personal information. I obviously removed this and blocked him from posting it, but I understand that there's not much he can do.
Then 6 days ago, he blew the bomb. He left a note saying my full name, and address, and stating that he has reported me to the tax people for evasion of tax and undeclared income. He also has spread further lies.
I'm just a young individual who is looking to make some money on the side to optimize the amount of income I am getting, while at the same time learning how to do things business wise and technology wise, and also have money coming throughout the month rather than one big paycheck.
This money flows straight from a PP account to my bank account, the same bank as my wages.
I was earning £9500 per annum, but got a raise two months ago, which bought my annual income higher, and I am not sure whether or not I will hit the bracket (earnt around £750-£800 a month for around 4/5 months).
Should I declare this extra income? Should I do it immediately? Will my work be contacted? What if he contacts my place of work? I'm just young and quite shook-up from this whole experience. I have his personal information to (collected on signup of the site).
How should I handle this? Am I at risk of being fined/losing my job? Who should I consult?
Sorry for the wall and loads of questions, but as am 18 year old, I have no idea what to do. We don't get taught this !!!! in schools... Why education system! Why?!

Keep_pedalling

You are not at risk of losing your job and as you have only been doing this for a few months, you currently only need to file a tax return for the last financial year, assuming you started your business before April 6th, which you still have plenty of time to do so you will not be facing any fines unless you fail to act now

You need to register for self assessment and once that is done you can file you 2015 - 16 return although it does not sound like you will have any extra tax to pay for that year because your profits are unlikely to take you over your personal allowence.

sheramber

Will you lose your job?
Does your employment contract prohibit any outside work without your employers permission?

Is there any conflict of interest between your main job and your second job? Are they similar?

whowants2brich

As a side point, how does he know that you have undeclared income and that you are intentionally evading tax? does he have proof?

From what I can tell (and others have posted), if you've recently started, then you haven't done enough trading to be in trouble, but you need to address it before you trade more and then it could be more difficult.

If he has negatively impacted your business, and you can prove it, then maybe you need to either cease trading so that he doesn't impact your business further - and then you can restart, under a different name if necessary, to limit any damage to the company reputation.

Alternatively, maybe you can think about threatening him for defamation and damages as a result - though if you have a new company, you'd have a hard time proving a financial impact...

It's infuriating when all the hard work of people gets ruined by some crazy individuals, who think that throwing their weight around online is productive - when in reality, it makes them look stupid and impacts individuals and businesses. Most annoyingly, they do this because they know that there's very little potential recourse that individuals or companies can take...

Houseplant26

I'm potentially going to be in a similar situation as you as I plan to start a small side business to supplement my earnings from my main job (not that dissimilar to yours and it can be a bit of a struggle).

I only know as much as registering to be self employed and doing a return but no idea how I go about the ins and outs so will follow this with interest.

Good luck and I'm sure it will all be fine. Most people don't listen to one persons view, especially if it is clear they are going to such trouble to be downright nasty!