How do you register as self-employed?
Discussion
Guys,
My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
How is the best way to do this?
As I've always been employed by a company I have no idea where to start.
how does it work with paying tax? I assume that you keep the records, fill in the tax return and then wait for the bill?
Will probably have more questions but think this'll do for a start.
Thanks
My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
How is the best way to do this?
As I've always been employed by a company I have no idea where to start.
how does it work with paying tax? I assume that you keep the records, fill in the tax return and then wait for the bill?
Will probably have more questions but think this'll do for a start.
Thanks
Woody said:
Guys,
My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
How is the best way to do this?
As I've always been employed by a company I have no idea where to start.
how does it work with paying tax? I assume that you keep the records, fill in the tax return and then wait for the bill?
Will probably have more questions but think this'll do for a start.
Thanks
If she's going to be taking on liabilities (rent, stock etc.) then wouldn't she be better setting up a Limited company to trade from? My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
How is the best way to do this?
As I've always been employed by a company I have no idea where to start.
how does it work with paying tax? I assume that you keep the records, fill in the tax return and then wait for the bill?
Will probably have more questions but think this'll do for a start.
Thanks
Woody said:
Thanks for the reply - no idea, which is kind of why I'm asking.
It is worth just popping along to an accountants really. But I would suggest she sets up a ltd company and then is the director and pays herself that way. The business then has the accounts, the insurance and the rent etc.
The only "registration" that a self-employed person has to do is to notify HMRC that they have started running a self employed business. Under current rules, they are supposed to do this within three months of the commencement of their sole trader activity.
HMRC allows an individual to notify them in a number of ways, probably the easiest and quickest being for the individual to call them on their notification phone line.
Details about what to do are here.
https://www.gov.uk/set-up-sole-trader
Some people run their businesses through a limited company. There are legal and tax advantages in doing this - but only, in my view, if the business is going to become substantial fairly quickly (generating profits in the £40,000 to £50,000 region).
However, the landscape for both sole traders and limited companies is changing radically from 6 April 2016 so advice that previously made sense will need to be radically revised.
HMRC allows an individual to notify them in a number of ways, probably the easiest and quickest being for the individual to call them on their notification phone line.
Details about what to do are here.
https://www.gov.uk/set-up-sole-trader
Some people run their businesses through a limited company. There are legal and tax advantages in doing this - but only, in my view, if the business is going to become substantial fairly quickly (generating profits in the £40,000 to £50,000 region).
However, the landscape for both sole traders and limited companies is changing radically from 6 April 2016 so advice that previously made sense will need to be radically revised.
Woody said:
Guys,
My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
You're aware that she should have been registered already?My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
As a Sole Trader, she'll just have to fill in a Self Assessment each year, you then pay the tax you owe (by Jan 31st) AND half of the next years tax in advance.
She may need to think about VAT, not necessary to register for turnover under £82k but, if she's buying and selling, has a lot of business expenses, it could be advantageous.
She may need to think about VAT, not necessary to register for turnover under £82k but, if she's buying and selling, has a lot of business expenses, it could be advantageous.
Spangles said:
Woody said:
Guys,
My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
You're aware that she should have been registered already?My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
However, once a person makes a definite intention to start buying and selling goods or provide services with a view to making a profit, then from that moment on they are trading and will need to notify HMRC within three months.
Note, they are still trading even if they have made a loss.
Eric Mc said:
Spangles said:
Woody said:
Guys,
My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
You're aware that she should have been registered already?My wife has been selling her self published books at craft fairs over the last 12 months but now has the opportunity to open a small retail premises in town.
She will need to register as self employed and set up the business.
However, once a person makes a definite intention to start buying and selling goods or provide services with a view to making a profit, then from that moment on they are trading and will need to notify HMRC within three months.
Note, they are still trading even if they have made a loss.
She has written and self published 2 children's books and anything she has made has gone to charities; which, with costs of publishing etc. has been very little in the grand scheme of things.
She now has the opportunity to turn her hobby into something more.
fatjon said:
Not aware that there is any such thing as registering as self-employed. You just declare your finances on your self assessment form at the end of the year.
I've run businesses as a sole trader and a Director for 25 years and never "registered" as anything.
HMRC used to require you to notify them within 3 months of commencement of your trading activity - as I mentioned above.I've run businesses as a sole trader and a Director for 25 years and never "registered" as anything.
They seem to have relaxed this a bit but you can see they would prefer you to let them know you have started a business as soon as you start the business.
PER HMRC -
Register
Register as soon as you can after starting your business. At the latest, you should register by 5 October in your business’s second tax year.
Example
If you start working as a sole trader between April 2014 to March 2015, you should register before 5 October 2015.
If you register later than this, you won’t get a penalty as long as you send your Self Assessment tax return and pay your bill on time.
Edited by Eric Mc on Wednesday 24th February 12:20
I agree you need to register but you are not really registering as self employed, just telling them you have an income source which is not PAYE and please send me a tax return form every year. I think the reason I have never registered as self employed was that I simply phoned them to say I had none PAYE income and asked them to send self assessment form and they did so from then onwards. The whole registering as self employed is a bit of a misnomer used by the revenue to keep it simple and understandable I think. If you already fill in a self assessment form every year there's nothing more to do.
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