daughter setting up on her own advise needed

[Deleted User]

My daughter is setting up on her own as a nail/beauty technician...she has looked at filling in a form online for tax (I'm not sure which form. Could be the one to register as self employed) and one question asks about the business address if different from home address....she hasn't got a business address as such as she is renting a chair at a salon owned by someone else....how does she answer that question.....also is there anything else she needs to know...do ...etc
Thanks in advance

KiKi

The business address is just where the business is running from, so I'd put her home address for now. As she's renting a chair, that may change in the future, but the correspondence can go to her home address.

Whether she's setting up as a limited company or a sole trader, the main thing is that she registers the company or registers as self employed. She should also put the right amount of money aside for tax and / or National Insurance so that when the tax bill comes in she has the money ready, rather than having spent it all!

There's lots of great advice on the HMRC which she should read beforehand.
Sole Trader option: https://www.gov.uk/set-up-sole-trader
Limited Company option: https://www.gov.uk/limited-company-formation/set-up-your-company-for-corporation-tax

KiKi

*~Zephyr~*

I suggest she stays as a sole trader for now. Ltd companies have to file Corporation Tax Returns and they are NOT user friendly! She would need an accountant to do that for her and that will eat a significant chunk of her turnover.

[Deleted User]

Thank's I'll advise her to do the sole trader thing....are the tax return forms that she'll have to do for herself very difficult to complete....she's never done any before.....I think she's going to put a % of her daily / weekly takings into a separate bank account to cover tax/ ins any suggestions on the amount 25% 30% ??
I doubt she'll ever earn enough to pay tax as its only going to be part time as she has a baby but she obviously still needs to register ? Correct ? And Nat ins needs to be paid either way ? Is the tax code for self employed the same as an employed person..?

I'll point her in the direction of the info you have given above...many thanks

annandale

Tax return forms aren't that hard to complete.

Wookey

She needs to keep a basic profit (money received) and loss (money outgoing) tally each day/week including the cost of the chair rental. This should include payments received in the shop and also any that are made from doing home visits for wedding prep/functions etc. You should also take some time to read up on the various expenses that you can make allowances for, an example would be a car for home visits or a pc/internet for filing tax return online.

Hopefully by the end of the tax year the profit side is higher than the loss side, it may also be worthwhile her doing a basic book keeping/accountancy course at the local tech even if only to put herself at ease filling out her own tax return as this will save her a fortune over the years as opposed to paying an accountant to do it. It isn't hard at all and if you do the basic bookwork daily/weekly as you go it takes 15 minutes to fill in the tax return, an accountant could charge you up to 1k for doing it.

[Deleted User]

Thank you I'll pass that info on to her too .

Slinky

Does she need her own public liability insurance or will she be covered by the salon's insurance? Don't want to be sued by somebody with a dodgy hair treatment.

[Deleted User]

Slinky wrote: »

Does she need her own public liability insurance or will she be covered by the salon's insurance? Don't want to be sued by somebody with a dodgy hair treatment.

She's doing nails and beauty ( I.e massage ..Waxing ..etc..) she isn't a hair dresser....but I believe she has set up her insurance....I will check for sure with her . Thanks .