self employment-tax-many questions

eaglesrjh

Hi all, I have a part time job paying over the personal tax allowance so therefore am paying tax and n.i through paye as normal.

I am now looking into boosting my income through a number of channels and understand that i will need to register as self employed to do that. I will be earning both by buying/selling goods, mystery shopping and any other avenues i can! I presume I only have to register as self employed once regardless of how many differnet avenues of income i have.

So questions
N.I. paid thorugh part time job, do I still need to pay class 2 contributions for self employment?
Income tax. For self employed income do you still pay monthly or is it a yearly bill after self assessment.

Whats taxable? I think i'm right in saying if i buy at x then sell at y with z expenses(paypal fees,ebay fees,p+p fees) then my taxable income is y-z-x. so income-original cost-cost of selling=taxable profit.

expenses.
much of my buying will be done at charity shops, car boots etc can i claim the 40p per mile for driving to these places as I will only be going to them to look for goods to sell? What about cost of parking near these places is that tax deductable? Have also read that i could claim a proportion of my broadband bill, and claim something for printing costs etc is this correct?

If I where to get a second phone, purely for the self employment, i.e keep my personal mobile for my own use and a second phone for all self employment use does the cost of the phone and/or the monthly rental and bills become tax deductable. Basically I think I would need a phone with good internet access to constantly check likely selling prices to ensure that I can buy at right price.

How do you deal with issues when you cannot get a receipt to prove what you paid for an item? I.e buy at car boot sale or from small ads?

If I am given an item for free and then sell it, is this part of the self employment or is that just me selling something personally (or does this still count as income?)

If I sell something I already own. I.e I upgrade to a ps3 from the ps2 I already own, then sell the ps2 is this taxable income?

Sorry for all the questions, I probably have more but will leave it at that, I am plowing my way through the HMRC website but its giving me a headache!

Many thanks for any help given (I am a user of the thanks button btw! )

Richard

edddd1

I'd say most of what you are saying looks about right. Allowable expenses need to be incurred in running the business, and yes ideally keep as much evidence as you can, were HMRC ever to look into your trading.
Class 2 NI. If you are paying Class 1 at your job, I believe there is a limit where if your SE income is below a certain level (might be around £4800 or so per year for the S/E business income) you can apply to be exempt (to NI office up in Newcastle).
Also, I believe you are suppose the declare different business income on seperate SE pages of the return, if they are seperate, ie a restaurant owner who also sold second-hand cars would complete two SE pages in his tax return. May not apply in your case but maybe something to look into (HMRC's website should have the Self-Employment page notes somewhere)...
As I understand it, also, if you buy an item with the intention of selling it on, then you are trading, but selling your own PS2 to get some money together to get a PS3 would seem to be outside your Self-Employment businesses and I would not include that sale in your business accounts.
Finally, taxable profits are, yes, Gross Income less your allowable expenses. And if you do have to pay Class 2 Ni, there's also Class 4 NI on your Taxable Profits (Taxable Profit minus Personal Allowance for tax year (ie 07-08 £5225) times 8 percent). That is on top of any Income Tax liability.

nephilim

for the printing, get a printer that prints something like 15000 sheets per cartridge, and get that much paper, and say you have printed that many flyers, ads, etc of whatever it is you do, and do it at 6p per page. the cost of the printer, ink and paper is no more than £200, but at 6p per page, for 15000 sheets of paper, you can get £900, so you MAKE £700 from the taxman!

just something my brother does for his company (although he does go through about 15000 sheets a year)