Working full time and starting a part time business

VintageBelle
VintageBelle Posts: 321 Forumite
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in Small biz MoneySaving
Hello


I am looking for advice as I'm very confused by all the info that I find online.


I am in full time paid employment but want to start a part time online business.


Can I register as a sole trader if I am also working full time?


Also will my tax and NI be kept separate from that of my employment?


Will I have to pay class 2 NI on my business?


Any help you can provide will be much appreciated.


Many thanks


Anna

Comments

  • Savvy_Sue
    Savvy_Sue Posts: 46,021 Forumite
    Name Dropper First Post First Anniversary
    VintageBelle wrote: »
    Can I register as a sole trader if I am also working full time?
    Yes.
    VintageBelle wrote: »
    Also will my tax and NI be kept separate from that of my employment?
    Yes. What's more, if you make a loss initially, I believe that can be offset against tax paid in your employment, at least in the short term.
    VintageBelle wrote: »
    Will I have to pay class 2 NI on my business?
    Any liability for NI will be calculated when you do your tax return, on which both your employed and self-employed income will be listed.
    Signature removed for peace of mind
  • rickyroma
    rickyroma Posts: 166 Forumite
    First Anniversary First Post Name Dropper Combo Breaker
    Hope it's ok to add a question to this thread rather than start another! It may be of interest to the original poster too.
    The £1000 tax allowance.....is this only for sole traders where it is their only source of income or could a sole trader who also has a full time job claim the allowance?
  • PasturesNew
    PasturesNew Posts: 70,698 Forumite
    Name Dropper Photogenic First Anniversary First Post
    Many people do it.

    Just register as self employed and set up/run your business and keep accounts.

    Each month you get a wage slip from work - at the end of the working year you'll get a P60 from work. Keep these.

    From your self employment you'll have expenditures and income - and you'll do your accounts.

    Once a year, log into the tax website and fill out a Self Assessment form. On there it asks "do you have a job" and you fill in your job details and the figures of how much you've earnt/been taxed. You get these figures from your wage slips/P60.

    Then you also add in that you are in self-employment and fill in the figures there. If you've not made much money (up to about £15k or so) you have an option to simply type in the one figure of profit (turnover - expenses).

    It's as easy as that.

    The system then looks at your total income and tax already paid on your job and shows you the figure of any tax or NI you need to pay for the self employment part. You can then click through and pay that amount online right then and there if you wish. If your figures are simple and straight forward, this will probably take you half an hour a year to do.
  • SimoneAmanda
    SimoneAmanda Posts: 1 Newbie
    Starting your side hustle now in April 2019 means you wont be submitting an online self assessment until the of end of jan 2021, (or end of Oct 2020 for a paper submission). Letters have just come out requesting self assessment for apr 2018-apr 2019 so you have plenty of time to suss it out and get your record keeping in place. The tax benefits of combining employment and self-employment is often the reason why ppl start part-time biz. To be comfortably covered, put aside 25% of your profit every month to ensure you have the means to pay your tax bill , although start-ups don't often make enough of a profit in the first few years, in which case, book a holiday with the money you saved lol. I wish you much success.
  • Elise1912
    Elise1912 Posts: 54 Forumite
    If you create a limited company, you could be the employee, director and secretary. Depends how much you'll pay yourself. If under the threshold, you'd pay no income tax or NI contributions I believe. You would need to do PAYE if its more. Yes your tax for the business would be separate to your FTE income/tax.
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