Declaring past freelance jobs..?

ilikegeeks

Hi,

I'm employed full time, but am trying to start out as self-employed. I haven't declared this, silly of me I know. I've only done about 4 one-off jobs and earned no more than £400 since April 2007. I am hoping to get more work now so will declare it, but am worried about the £100 fine and paying back payments for tax.

I read somewhere about this penalty:
The penalty will only be suspended if the taxpayer is already paying maximum Class 1 contributions or she/he expects to make profits below £4,745.

Does anyone know if this amount is for the total I earned from all my work, or just my freelance work? And how do they know when I started work? (Obviously not suggesting that I'd lie but just curious! :-) )

ilikegeeks

Oops, how impolite of me... I meant to say thanks in advance for any help!

ali-t

the chances of you being caught are likely to depend on the paper trail you left behind. Did you send invoices or was it all cash in hand. did people pay you from their business accounts or was it all domestic? If there is no paper trail don't worry but if there is, you might need a contingency plan.

I set up as self employed in Jan 07 and had to submit my tax forms for 1/3 of the year from Jan to March 07 so surely you will be ok until the end of this financial year?

I'm sure someone more knowledgeable will be able to give you a more detailed answer but this is my experience to date of being self employed.

ilikegeeks

I emailed invoices and then was paid by cheque - so I suppose this is traceable. But how do they know that the name on the company's books refers to me? Surely there must be other freelancers with my name! It's too risky though, I know I am going to have to tell them, it will cost but at least it will put my mind at ease! Thanks for the advice.

Does anyone else know whether the fact that I earnt so little means that I won't have to pay the penalty?

terryw

Surely you no cause for concern? You have until January 2008 to file your tax return for the year ended 5 April 2007 and you will not receive your return for the year ending 5 April 2008 until after that date. Merely enter the income received from these casual freelance jobs in the section for this or under "any other income" You will get a bill for the tax but no penalty as you have declared it.

terryw.

ilikegeeks

I understand that I have longer to file my tax return, but what I was refering to was actually declaring myself as self employed. I was under the impression that I should have told them within 3 months of my first job that I have become self-employed?

terryw

OK sorry I see what you mean now. I doubt if there will be any problem...you are not really self-employed as you have have merely taken on a bit of extra casual work which you are declaring on your tax return. I think it would be a churlish tax official who could take any other view on this.

The cut-off date for filing the return for 2006/2007 is 31 January 2008 and there is an automatic penalty if it is not filed by then. I am guessing that this income did not start until after 6 April 2007 in which case you have until 31 Jan 2009 to file the return for 2007/2008. Why not file a form for 2006/2007 and put a note on about your new income?