Need help with additional earnings (tax)

ldratio

Hi everyone!

Me and a friend are both artists and have just set up a website in order for us to earn a bit of money on the side of our full time jobs, so I'm just wondering of the rules we have to follow for tax purposes and other things as result of earning additional money on the side.

What do we need to do before getting out first bit of money?
What tax will we need to paid on that earning and how can it be paid?

We are really quite novice at building businesses and tax and until now have had our tax paid for us automatically through normal salary circumstances.

Importantly we haven't made any money until now, and we both earn under 25k a year from our normal jobs, this additional income won't be any larger than 10k a year, although our 10k personal allowance is already taken up from normal salary.

It's basically just design services for a niche audience, and we'll probably ask for small businesses to pay our fees into a PayPal account linked with a normal current account.

Any help would be great, happy to answer any questions.

I know we have to both register as self-employed, but not sure of what needs to be done past that. What's the best route for us to set up, we are both in full time employment and want to remain anonymous so that our full time jobs are not affected.

DomRavioli

Have a look at th HMRC guides on their site. They have some great information.

ldratio

So it sounds fairly straightforward with the business partnership structure which I think is what we're going for.

So just to confirm with people here.

As there's two of us, we split the income tax for our own self assesments?

So for example if we earn 1k from a job and the tax for that is 20%, we pay 10% each as we're in the partnership?

System

This isn't really the right place to ask about a business partnership structure as most people here would be classed as sole traders working as self-employed completing surveys and the like.

HMRC are surprisingly helpful if youjust give them a ring and as you'd be ringing outside of tax return busy time it shouldn't take long to get throgh.