The Great 'Working for Yourself' Hunt

stphnstevey

Haven't had chance to read all posts as only go to 2nd page - marking to read later

babyfaceclothing

nykmedia wrote: »

Re tax & self-employment.
Best to get started by opening your business bank account, registering as self-employed and setting up a direct debit or standing order for your regular NI contributions. Check out www.hmrc.gov.uk for all the details, as there are still more changes to be made to the income tax. You are only taxed on your profits, so I'm assuming you will need to deduct allowable expenses from your £130. Also, as self-employed, I am assuming you are permitted to carry out other contracts of a similar nature, so your hours and income could easily increase. As a very basic and general rule of thumb, I would save 20% of everything over £100 per week. I'm no expert, but I THINK this should work safely enough to cover any tax due next year.

EDITED IN: I have just read Martin's weekly email newsletter and there's an article in it that states, "Self-employed/freelance warnings! A third of what you earn isn’t yours... " so I am now totally flummoxed. One third??? Can anyone please explain this, as I must be missing something and certainly do not want to be caught short on tax next year. If I manage to earn £15000 of profits, the above suggests I should set aside £5000 for the tax man. I can't understand this, as I'd have thought that you would deduct your personal (tax free) allowance, which is currently £5,435 (but will apparently change this year again) and then 20% of the remaining £9565 would be the tax. £1,913 is nowhere near £5000. Can someone please explain where I have gone so badly wrong, thank you. I do know that National Insurance is payable on the above but even including that... I'm lost

Thank you for the advise still a little confused though, I didnt intend this to be a business only because I took the job for the convienece of working from home so i could study and be able to pick the children up from childcare. I will only be making £6240 a year approx and the way the call centre company works I wouldnt be able to take on any other jobs as i use there equiptment and they route the calls directly to me

dmasih

if you are in business, VAT registered and travel overseas (mainly to or within Eurpope) then make sure you claim the overseas VAT refunds you may be due. Most businesses worldwide with employees travelling cross border to / within Europe are entitled to VAT refunds on many overseas business expenses such as exhibition costs, accommodation, meals, car hire etc. Many businesses are not aware that they are entitled to these refunds which can often add between 16-25% to your business travel expenses!!! It's your money....claim it back!

I set up in business last year and assist businesses to obtain the overseas VAT refunds they are due. If you need any further help on this issue drop me a note.

best wishes to all those just starting out. :j

Frugaldom

babyfaceclothing wrote: »

Thank you for the advise still a little confused though, I didnt intend this to be a business only because I took the job for the convienece of working from home so i could study and be able to pick the children up from childcare. I will only be making £6240 a year approx and the way the call centre company works I wouldnt be able to take on any other jobs as i use there equiptment and they route the calls directly to me

My opinion would be that you keep accounts anyway, register self-employed, pay your National Insurance Class 2 stamps by Direct Debit and the tax should be 20% of everything over your personal allowance. I'd also check to see if you qualified for child Tax Credits & Working Tax Credits. Good luck with your work, I hope everything goes to plan

Sorry about confusion of the latter part, I still haven't found out what the MSE newsletter means about one third earnings belonging to the taxman.

stphnstevey

Finally got through all pages!

Some good advice - somone mentioned http://www.msofficeaccounting.co.uk/downloads1.aspx

Has anybody used this software and is it any good?

tryfive

Middlestitch wrote: »

If you don't want to use a home address (and in these days of identity theft it might be a good idea not to have too much personal information floating around on advertising material), a PO Box number gives some protection and also looks a bit more 'professional'.

OTOH, it can make you look like a fly-by-night cowboy: "Why is this guy, who works for himself and with no employees, hiding behind a PO box?!"


Depends on how your customers (and potential customers) look at things, and the industry you're in.

(Incidentally, you can easily get the real address behind any PO box by simply asking the post office!)

Dustangle

eric_the_red wrote: »

If you are in any business which can be run from a computer and / or telephone, with infrequent live meetings, leave the EU area and do it somewhere else such as the Channel Islands, the Isle of Man, or if it is a real money-spinner, Iceland. They are not far away. You have three months to play with in the UK each year , if you need it without becoming domiciled again. Check it out. If you have a business which is anything like successful then rip-off Britain will hammer you. The other places have clear and simple tax regimes, without the mounds of red tape.

That is shameful. Britain made you and it is wrong to rip it off.

tryfive

mdavis1982 wrote: »

Maybe I could do a deal for anyone who is starting up in business who needs a new web site from MSE? I'm not sure if I'm allowed to post links to my web site, but it's website address removed. If you mention MSE when you call I can offer you a good discount on my usual prices! Maybe that'll be of help for anyone starting their new business?

I've been reading MSE for over 3 years now, and I've found lots of good help and advice. I thought it might be my turn to give something back!

i.e. Tip #101: If you want to be paid X for your services, state that your charge is (X * 1.10), then give a 10% discount.

Makes you look like a "bargain" supplier, and increases the perception of what you're work's worth - it also means that it's easier to raise your prices later (after the "discount" runs out)

A very common ploy - especially in the software industry!
.

MSE_Martin

Hi just a quick answer to the question about a third of your money.

This is my very rough rule of thumb to how much to put away after tax and national insurance. Obviously those who earn less pay less because of the personal threshold - but as a rough rule its a good guideline... and if you've put too much away at the end of the year... then you've still the cash in the bank - not putting enough away is the biggest problem.

Martin

Herbyme

Hi all,
Great thread!
I'm writing this after getting back from meetings at 11pm. Self employment does mean I can nearly always be hhere when my kids get home from school, which is great, but I do sometimes work 9am - 3pm and then 9pm (when they go to bed) till 3am (if I can stay awake that long). But not that often.

My top tips, some same as others but it may help to know which ones are generally applicable:
get a good and nice accountant - you don't want anyone who will make you feel stupid when you ask stupid questions. Mine admits to erring on the sside of caution and as a result I've survived a tax inspection (caused by my very odd cashflow) and a VAT inspection. NB being on the flat rate VAT scheme makes a VAT inspection MUCH less painful. My accountant advised me not to become a Ltd company as the savings would hardly offset the increase in his fees and the bank charges of a business account (I use a personal one, just keep it separate from your others so the tax man can easily see all monies coming in to one account)

I couldn't survive without a husband on a decent paye income. Some months I have no income at all, then it all comes in a big lump. Definitely put 30% aside for tax and remember that if you have a poor year, your tax will drop massively the next year and then rise massively the year after - set aside enough to pay for the massive rise.

Don't bother advertising professional services - I'm a market researcher - word of mouth is all in my business. Over 90% of my work in the last 3 yrs has come from repeat business or business referred to me by regular clients. In fact probably 90% of all my work in the last 10 yrs has come from 2 original contacts. When you invoice for a job, ask for written feedback and put it in your publicity materials/on your web site/business cards - ask first if you want to name the person who said it.

If your clients regularly pay late, try sending the invoice in with a 10% mark up and a note saying '10% discount for payment by xxxxx date' - surprising how it motivates accounts departments.

Unless you are an IT whizz, find a local supplier who will sell you the right hardware and fix your PC/laptop when it goes wrong, set up your wireless internet etc. PC World is unlikely to do it tho the laptops may be a bit cheaper!

Hope all this helps and good luck!