New at being self employed

janninew

Hi All,

Quick question regarding self employed and filling out a tax return. I registered as self employed in June this Year, will I have to complete a tax return in January?

Both myself and my husband have only even been on PAYE and we are finding me being self employed quite stressful, information is hard to come by! I have registered, have an online account etc.

Thank you.

BoGoF

No, your first Tax Return will be issued next April to be submitted by 31/1/19

janninew

BoGoF wrote: »

No, your first Tax Return will be issued next April to be submitted by 31/1/19

Great thank you. Do you get postal information from them? When you say issued in April, will that be my earnings from June 2017 when I registered until April 2018?

TheCyclingProgrammer

janninew wrote: »

Great thank you. Do you get postal information from them? When you say issued in April, will that be my earnings from June 2017 when I registered until April 2018?

It will be all of your earnings for the whole tax year (so 6 April 2017 - 5 April 2018), which will be your self employed earnings from June onwards plus any other income you may have had (including any employment income taxed under PAYE ) between April and June.

The notice to file a tax return will be issued some time after the end of the tax year and you'll have until 31 Jan 2019 to submit it, as the other poster already stated.

Try and set aside enough money to pay your tax every time you earn money, this should ensure you also have enough to cover your first payment on account if you're due to make one - if you're not familiar with payments on account, this is where you pay 50% of the previous years tax bill again on account for the current tax year at the same time (when the 17/18 return is due on 31 Jan 2019 you'll already be 9 months into the 18/19 tax year) and a further 50% in July, with a final balancing payment (or refund) the following January. Most people get caught out with their first return and tax payment as you have the double whammy of paying the entire of the previous tax years bill plus the first payment on account.

janninew

TheCyclingProgrammer wrote: »

It will be all of your earnings for the whole tax year (so 6 April 2017 - 5 April 2018), which will be your self employed earnings from June onwards plus any other income you may have had (including any employment income taxed under PAYE ) between April and June.

The notice to file a tax return will be issued some time after the end of the tax year and you'll have until 31 Jan 2019 to submit it, as the other poster already stated.

Try and set aside enough money to pay your tax every time you earn money, this should ensure you also have enough to cover your first payment on account if you're due to make one - if you're not familiar with payments on account, this is where you pay 50% of the previous years tax bill again on account for the current tax year at the same time (when the 17/18 return is due on 31 Jan 2019 you'll already be 9 months into the 18/19 tax year) and a further 50% in July, with a final balancing payment (or refund) the following January. Most people get caught out with their first return and tax payment as you have the double whammy of paying the entire of the previous tax years bill plus the first payment on account.

Great thank you, I've printed your post out so I can digest what you are saying.

I'm still on PAYE as well, I don't earn much with my small business, makes me wonder if its worthwhile with all this to do. I suppose it gets easier with time and experience.

NineDeuce

It doesnt take that long as you can do it online. It can work out much better than PAYE rates if you are able to exploit the rules on expenses.

TheCyclingProgrammer

janninew wrote: »

Great thank you, I've printed your post out so I can digest what you are saying.

I'm still on PAYE as well, I don't earn much with my small business, makes me wonder if its worthwhile with all this to do. I suppose it gets easier with time and experience.

Most small businesses start small and get a bit bigger if they are successful. Don't give up. See how you're doing in a year or two and then re-evaluate.

It doesn't take long to fill out a self assessment. The employer sheets are really just about copying the figures from your P60 and your P11D (if you get one).

You don't need any bookkeeping software for now - start small. Use a spreadsheet to track all income and expenses. You'll need this to help you prepare your tax return. Start a new thread on here if you get stuck with anything in particular, or try UK Business Forums for more specialist help.

janninew

TheCyclingProgrammer wrote: »

Most small businesses start small and get a bit bigger if they are successful. Don't give up. See how you're doing in a year or two and then re-evaluate.

It doesn't take long to fill out a self assessment. The employer sheets are really just about copying the figures from your P60 and your P11D (if you get one).

You don't need any bookkeeping software for now - start small. Use a spreadsheet to track all income and expenses. You'll need this to help you prepare your tax return. Start a new thread on here if you get stuck with anything in particular, or try UK Business Forums for more specialist help.

Thank you, you've been a great help.

I've got a spreadsheet set up with my earnings and then my deductibles. I'll need to look further to what I can deduct off my earnings. Will I need to provide specific details of what i deduct or just the end figures?

Sorry but I'm pretty clueless about this!

00ec25

janninew wrote: »

Will I need to provide specific details of what i deduct or just the end figures?

provide to whom?

to HMRC?
no only the totals will be needed for your tax return

to your accountant?
it will save time (less fees!) if your spreadsheet provides sufficient info to enable anyone to cross reference the entry to the supporting paperwork/receipts/invoices etc if they need to do so
as a minimum:
- transaction date
- supplier/customer name
- transaction value (net and vat of registered)
- reference number (eg invoice/receipt number)

of course if, in the fullness of time, you do buy a bookkeeping software you may simply be able to photo and upload depending on your software. But as said above, that can come later once you're established and have a batter idea what you need.