Going self-employed - a few questions

odalay

Hi there, I have a few questions about going self employed.

1) If I register as self employed under my own name can I work 2 separate self employed jobs? eg...firstly as a gardener and secondly as an artist? I would probably be doing 5-10 hrs per week gardening, the artwork is much more sporadic, a few hours per month.

2) Can I then reclaim VAT for both those jobs on any purchases I make relating to tools etc, do I simply need to register as self employed under my name and then keep any relevant receipts?

3) I’ve read that I can reclaim VAT on purchases made upto 4 years before?

4) I also have a salaried job a few days a week, will registering as self employed affect this? (as in my Tax code, I might be taxed more??)

Thanks in advance for any help!

Isthisforreal99

You are nowhere near the VAT threshold and if you voluntarily register for VAT (which is different to registering as self-employed) you will need to charge VAT to your customers making you 20% more expensive straight away.

You cannot claim VAT back on anything dated before your VAT registration date.

Would suggest you speak to an accountant.

Dazed_and_C0nfused

odalay said:

Hi there, I have a few questions about going self employed.

1) If I register as self employed under my own name can I work 2 separate self employed jobs? eg...firstly as a gardener and secondly as an artist? I would probably be doing 5-10 hrs per week gardening, the artwork is much more sporadic, a few hours per month.

2) Can I then reclaim VAT for both those jobs on any purchases I make relating to tools etc, do I simply need to register as self employed under my name and then keep any relevant receipts?

3) I’ve read that I can reclaim VAT on purchases made upto 4 years before?

4) I also have a salaried job a few days a week, will registering as self employed affect this? (as in my Tax code, I might be taxed more??)

Thanks in advance for any help!

1.  No reason you can't do that.  Assuming it doesn't go against any terms you have agreed to in your existing employment.

2.  Will your self employed turnover make registering for VAT a wise move 🤔

3.  Can you provide a link to wherever you have that nonsense?

4.  That will depend on how you complete your own Self Assessment return.  But there is no need for it to impact your tax code if you don't want it to.

odalay

Dazed_and_C0nfused said:

odalay said:

Hi there, I have a few questions about going self employed.

1) If I register as self employed under my own name can I work 2 separate self employed jobs? eg...firstly as a gardener and secondly as an artist? I would probably be doing 5-10 hrs per week gardening, the artwork is much more sporadic, a few hours per month.

2) Can I then reclaim VAT for both those jobs on any purchases I make relating to tools etc, do I simply need to register as self employed under my name and then keep any relevant receipts?

3) I’ve read that I can reclaim VAT on purchases made upto 4 years before?

4) I also have a salaried job a few days a week, will registering as self employed affect this? (as in my Tax code, I might be taxed more??)

Thanks in advance for any help!

1.  No reason you can't do that.  Assuming it doesn't go against any terms you have agreed to in your existing employment.

2.  Will your self employed turnover make registering for VAT a wise move 🤔

3.  Can you provide a link to wherever you have that nonsense?

4.  That will depend on how you complete your own Self Assessment return.  But there is no need for it to impact your tax code if you don't want it to.

Thanks appreciate the reply Dazed_and_C0nfused

RE question 2 - apologies I might have describe it incorrectly or used the wrong term - basically I was told that for example if I start as self employed, purchase a piece of equipment like a lawnmower for £500 i can get the VAT added onto my non-taxable income. (20% of £500 = £100) So my non-taxable amount goes from £12570 - £12670 and so on. Can I do that as a basic self employed person, of need to fully set up a buisness?

RE question 3 - I read it here on the gov.uk site but it maybe refering to something different. Basically i'm delaying purchasing tool etc till properly registered as I thought I could get the VAT back as per above

https://www.gov.uk/charge-reclaim-record-vat/reclaim-vat-business-expenses

Thanks Isthisforreal99 - yes I think will speak to an accountant first. Cheers

Dazed_and_C0nfused

odalay said:

Dazed_and_C0nfused said:

odalay said:

Hi there, I have a few questions about going self employed.

1) If I register as self employed under my own name can I work 2 separate self employed jobs? eg...firstly as a gardener and secondly as an artist? I would probably be doing 5-10 hrs per week gardening, the artwork is much more sporadic, a few hours per month.

2) Can I then reclaim VAT for both those jobs on any purchases I make relating to tools etc, do I simply need to register as self employed under my name and then keep any relevant receipts?

3) I’ve read that I can reclaim VAT on purchases made upto 4 years before?

4) I also have a salaried job a few days a week, will registering as self employed affect this? (as in my Tax code, I might be taxed more??)

Thanks in advance for any help!

1.  No reason you can't do that.  Assuming it doesn't go against any terms you have agreed to in your existing employment.

2.  Will your self employed turnover make registering for VAT a wise move 🤔

3.  Can you provide a link to wherever you have that nonsense?

4.  That will depend on how you complete your own Self Assessment return.  But there is no need for it to impact your tax code if you don't want it to.

Thanks appreciate the reply Dazed_and_C0nfused

RE question 2 - apologies I might have describe it incorrectly or used the wrong term - basically I was told that for example if I start as self employed, purchase a piece of equipment like a lawnmower for £500 i can get the VAT added onto my non-taxable income. (20% of £500 = £100) So my non-taxable amount goes from £12570 - £12670 and so on. Can I do that as a basic self employed person, of need to fully set up a buisness?

RE question 3 - I read it here on the gov.uk site but it maybe refering to something different. Basically i'm delaying purchasing tool etc till properly registered as I thought I could get the VAT back as per above

https://www.gov.uk/charge-reclaim-record-vat/reclaim-vat-business-expenses

Thanks Isthisforreal99 - yes I think will speak to an accountant first. Cheers

I honestly have no idea what you are talking about.

I'm guessing £12,570 is a reference to the Personal Allowance?  If so there is nothing anyone can ever do to increase that, the absolute maximum is £12,570.

Why would you delay registering for 4 years 🤔.  I still don't really understand why you think registering for VAT, and therefore having to add 20% to the fees you charge people (which you then need to pay to HMRC), is a good idea. 

What do you think your turnover will be?

odalay

Ah apologies I have no intention of charging my customers VAT, I think what I have been talking about is actually referred to as "expenses" these can then be deducted from your taxable income while self employed. I'm just wanted to understand roughly how this works. See here - 

https://www.gov.uk/expenses-if-youre-self-employed

The 4 year timeframe is irrelevant all I wanted to know is if I purchased some tools now, and then registered as self employed in 1 months time was could I claim these expenses retrospectively?

My turnover will be small, £500 - £1000 per month. I also have a contracted job of roughly 20hrs per week so will be working in-between that

Many thanks

uknick

Pre-trading expenses | Low Incomes Tax Reform Group

TheNorthStar

I hear what you're saying, you have no intention to charge customers VAT so therefore you will not be a VAT registered company. So buying a lawnmower means it comes out of your profit. So in fact, yes, you will be paying less tax because of proportion of your expenses are written off. Which is why you were referring to your £12,000 allowance increasing. So whilst you won't have the benefit of claiming the VAT back, you will pay less in tax at the end of the year, so buying goods that you can legitimately use a need for the business will help reduce your tax at the end of the year. It's the same with petrol receipts etc, although you can only assign a proportion of that which is company mileage as opposed to personal use. Assets like your lawnmower won't necessarily all get deducted within that same financial year it's sometimes taken over a three year period from memory.  Business insurance for vehicles and public liability insurance can also be offset. So can a small allowance for home office usage. I'm not an accountant, but you're on the right track with your thinking.