Discussion in 'Business & Tax Advice' started by Jon0, Jan 16, 2012.
You either get an accountant or do your own taxes. I wouldn't recommend seeking any advice here, and there's no point me reiterating what you can already find by Googling. There's a ton of information out there on how you go about things, including plenty of information on the hmrc's own site.
Register as self employed, do tax returns. You have 3 months to register starting from the day you earn your first bit of money.
I would advise putting about 30-40% of your earnings aside each month ready for tax season. If you end up with a smaller bill than you've saved up for you get a nice wedge of cash to play around with.
If you're working with clients rather than a CPA company (for example) I would advise thinking about starting a ltd company. Last thing you want is an unsatisfied customer taking you for all you have.
Hope that helps.
You've got 3 months to let the tax man know that you're trading or you're up for a fine. As said, get in touch with the tax man, they're really very friendly IF you play straight and they offer a load of info for you to get things right.
I went on a day workshop at my local tax office and got the information I needed to stay legal.
Speaking of which, I've doing my self-assessment in the next few days and I'm ready to pay the bill!
As said above, put money aside to pay the bill!
Get some good software to keep track of everything like Sage.
Speak to an accountant to see what you can claim as expenses. e.g. If working from home how much utility bills you can claim. The more you claim as an expense the less tax you pay. Say you use your car for work and please you can claim a % of that too.
What about if you live abroad, eg in Japan or Philippines but earnings still get paid to your UK account but you are not physically based in the UK?
You are correct, you cant just dont bother.Its tax evasion and its illegal ofc. Why not bother actually?If you are below the threshold, you pay nothing but you are sticking to the laws and 100% legit professional....
Even if you have zero earnings, you need to submit tax returns. Operating a business is not connected to profits. Dormant companies are still companies for example.
For the cheques, you can :
1.Keep copies of them (photocopies)
2.Have a record of the bank transactions(money flowing in...)
If you leave abroad and your business is abroad, then you need to adhere to your local laws. For the UK for example, a business is liable for UK tax if it is operates in the UK (the bank account is irrelevant).
This just about covers most things i believe. Thanks all!
The bank give you a receipt when you deposit a cheque.
If you reread my post you'll see that I say: I wouldn't bother. Never said: "not to bother".
But I'll make it clear why I said I wouldn't bother: most people reading this thread will be spending more than they will ever make back - not exactly a definition of a self employed person - more a bankrupt person.
The horses mouth: read: http://www.hmrc.gov.uk/manuals/salfmanual/salf210.htm
Bolding is my emphasis. Only if you ?has profits? or "chargeable gains on which tax is due" which for a person only starts above the threshold allowances for when they are "chargeable to tax". Then you must notify.
You have until the 5th of October in the next tax year, to tell them about tax you owe them in the previous tax year.
Most businesses need to make a profit to keep going.
Irrelevant here, as when you submit form CT41G, you tell HMRC that the company is not trading, that it is dormant and you don?t have to file a tax return for that period on (but you still have to for the period up to the dormant date). Now if you trade after having told them that the company is dormant (without filing form CT204), than you are breaking the law - which is a completely different situation to a person not filing a tax return when they don?t earn above the threshold.
My point being: It is not tax evasion, when you owe no taxes. Nor is it illegal. Just a technicality. And one from 10+ years of experience, they don't care about.
For those abroad:
As a basic rule: UK tax is territory based, especially for company's (for the most part).
For individuals it's domiciled based - if you spend less than 90 days a tax year in the UK. Then you as an individual owe no tax.
Stay on the right side of the tax man cause once he gets his teeth into you he wil squeeze and squeeze until your not moving anymore!!
I'm doing my tax right now!
October is just for paper tax returns, It's tax time right now for people who submit their tax returns online, so I'm doing mine this week to avoid any fees, the due date is the end of January.
It's not that hard to do you own tax, just go through your bank account and key in your businesses income and outgoings to an excel document, then key them in online at HMRC.
Accountants can help, but for what they charge and what they will save you, to me it's not worth it unless you are doing HUGE business or have employees.
Tip: NEVER try to trick the HMRC, they can come down on you and literally ruin you.
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