Self Employment - The Wife, Baby/Toddler Groups

[C0ffin D0dger]

Need a bit of help just to make sure this is viable / sensible.

The wife answered a recruitment advert for some local playgroup thing, baby singing or some such nonsense. She's keen to do it as is the person who runs it is to get her on-board. It could work well for her as it's part time, within school hours and term time (both our kids are at school). Realistically she's only doing it for the experience and a bit of extra cash.

So it sounds like she would be self employed and they pay for her services per session. We don't really consider this to be a proper job so sick pay, pension, holiday pay etc. isn't really an issue.

So is this as simple as?:

1. Register with HMRC as being self employed / a sole trader.
2. Get a business bank account & pay all earnings into that as well as taking out any expenses.
3. Record mileage done for the business, include that in the tax accounts.
4. Do some fairly basic accounting / record keeping (what information is required?).
5. File an annual tax return with HMRC

Realistically her earnings are unlikely to exceed the basic rate tax threshold so may well not owe HMRC anything. I'm guessing she might have to pay some NI, not sure what the thresholds are for that and how much you have to pay?

And so if/when she starts earning some money what's the acceptable process of taking that out of the business account as a wage?

Anything else obvious that I'm missing?

Thanks for your help, always been on PAYE myself so never had to consider it.

[BoRED S2upid]

Pretty much. Don’t expect her to be making much profit and make sure it’s a payment per session rather than a franchise or her having to cover the cost of the hall or community centre. One of our friends did something similar but it was a franchise and she lost money in the end.

[Mr Pointy]

Don't forget insurance & DBS checks. If there are going to be regular outgings then a seperate credit card makes it much easier to keep track of expenditure. See if you can avoid a business bank account as these usually have monthly charges & you won't be getting any benefit. Open a separate account though to keep things tidy & see if you get away with it.

[hyphen]

C0ffin D0dger said:

Realistically she's only doing it for the experience and a bit of extra cash.

Then get her to start her own facebook/gumtree presence and start her own thing.


If there is a demand for this kinda thing, then why not startup herself. If you need regular income, then it makes sense to work for someone.

[C0ffin D0dger]

Thanks for all the replies. Seems like it's not too complicated then.

It is part of a franchise but she will be working for the franchise owner and be paid per session.

DBS check is required and not too much of an issue to sort. I'll have to ask her about insurance, I don't know if the franchise owner covers her or if she'll need her own.

Hadn't thought about just keeping the account in a personal bank account. She has a Natwest current account in her name already that is pretty much dormant, could probably use that. We only use the joint account these days, all my money goes into it, she spends it (In fairness largely on housing, feeding and clothing me and the kids.)

And yeah if this goes well for her then branching out on her own is always an option, cuts out the middleman.

[Sir Bagalot]

Why are you getting a business account? Just use current account and keep a record of payments/expenses etc

[Mr Pointy]

This was just the first Google hit for childminder type insurance:

https://www.mortonmichel.com/

They do all sorts. Don't forget to check your car insurance covers business use..

[mfmman]

My wife did similar

Just used an old stylee carbon book to provide 'invoices'. They listed date, customer name and address, hourly rate and number of hours worked on each visit

Didn't worry about expenses incurred as she was never going to pay any income tax to offset them against

Mostly paid cash but just used her personal bank account

Registered as self employed with HMRC which generated a requirement to do self assessment. Paperwork exercise only, as no income tax was due. HMRC never asked to see any evidence of the sums/hours recorded

As she stopped doing it mid tax year (got a job) and added that as a note to the that years SA, they wrote to her stating there would be no need to complete any in future

We did insure for business use for the car, didn't actually compare with/without but from my previous experience I know it probably would have cost between 0%/10% on the premium which would have been 18 quid at most

Edited by mfmman on Sunday 30th September 12:46