Ignorant Buisness Starter
Discussion
Some business info from you kind folk would be much appreciated.
I’m in full time employment and my dad has requested me to do some drawing work for his company for which he will pay me.
I’m very interested in branching out to do this more and to develop it into a side line business and hopefully a full time business.
So…as it now stands, how would setting up a company to do this through affect how I’m taxed on the money I’d earn? Obviously the best way is to just have him give me some cash and say no more about it but I’d like to have a company set up so if I wanted to offer my services to others I’m in a good position to do so professionally.
Are places like switch media, the way to go i had a look at their website and got a few pages in, why do I need to have two “Officers” who are separate people? i'm confused.
Treat me like I’m ignorant, because frankly I am
I’m in full time employment and my dad has requested me to do some drawing work for his company for which he will pay me.
I’m very interested in branching out to do this more and to develop it into a side line business and hopefully a full time business.
So…as it now stands, how would setting up a company to do this through affect how I’m taxed on the money I’d earn? Obviously the best way is to just have him give me some cash and say no more about it but I’d like to have a company set up so if I wanted to offer my services to others I’m in a good position to do so professionally.
Are places like switch media, the way to go i had a look at their website and got a few pages in, why do I need to have two “Officers” who are separate people? i'm confused.
Treat me like I’m ignorant, because frankly I am
Without meaning to sound rude, the answers to 90% of the questions you have are easily answered on websites such as Business Link, and other business development sites, as well as HMRC themselves.
If you have a read through that, then if you have any further questions, i'm sure people will be happy to help
If you have a read through that, then if you have any further questions, i'm sure people will be happy to help
If you intend to do this type of work "freelance" on the odd occasion, then you might find that operating through a limited company is not worth the effort. You could declare these extra bits of income as "Self Employed" trading income and deduct from this income allowable business costs. Tax (and possibly NI) would be payable on any remaining profits.
If your "Self Employed" income in the tax year 2007/08 (the current year) exceeds £5,200 you would be below the Small Earnings Exception limit for self employed earnings and you would not have to pay any NI on this Self Employed income. For tax purposes, the net self employed income is added on to your other income from other sources and taxed accordingly.
Those with Gross Self Employed earnings from Self Employment of up £15,000 are allowed submit "Three Line Accounts" i.e. Income/Expenditure/Profit. No further details are required.
The downside is that you will probably need to submit a Self Assessment tax return in order to get this information to HM Revenue and Customs.
If your "Self Employed" income in the tax year 2007/08 (the current year) exceeds £5,200 you would be below the Small Earnings Exception limit for self employed earnings and you would not have to pay any NI on this Self Employed income. For tax purposes, the net self employed income is added on to your other income from other sources and taxed accordingly.
Those with Gross Self Employed earnings from Self Employment of up £15,000 are allowed submit "Three Line Accounts" i.e. Income/Expenditure/Profit. No further details are required.
The downside is that you will probably need to submit a Self Assessment tax return in order to get this information to HM Revenue and Customs.
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