Self-employed costs

[LeeGray]

Why bother doing the self employed bit. For £7000 a year? By the time you’ve paid for a vehicle, gear and all the insurance etc there won’t be anything left. Or is it £7000 profit you’ll have after all the costs?

 

[Midge]

11 hours ago, htb said:

Apologies had not noticed the employed wages bit when I 1st read your post, did you add it later.

Yes I did sorry! I realised people will read it how you read it and think my total earnings for the year would be £7200 alone! But with my employment wage aswell it will be around £32,700.

[Midge]

2 hours ago, LeeGray said:

Why bother doing the self employed bit. For £7000 a year? By the time you’ve paid for a vehicle, gear and all the insurance etc there won’t be anything left. Or is it £7000 profit you’ll have after all the costs?

 

 

Extra money on top of my employee wage and hopefully I'll be able to build up and become fully self-employed at some point!

I know I need a lot more work for that to happen but as I only started doing self-employed work towards the end of last year I haven't had that much to pay out.

 

All my tools have been bought second hand (except hedge cutters that are getting delivered today ?) I don't have a tipper van so only paying out 1 load of insurance and tax, same with fuel, for a vehicle that is used for work and personal life. 

 

Hope I can grow and earn more but happy with what I have for now.

[Midge]

Am I also correct in thinking that in your first year of registering as a new business you have to pay half of your expected tax for the year upfront, and then the remaining tax on 31st July?

[kevinjohnsonmbe]

10 hours ago, Midge said:

 

Extra money on top of my employee wage and hopefully I'll be able to build up and become fully self-employed at some point!

I know I need a lot more work for that to happen but as I only started doing self-employed work towards the end of last year I haven't had that much to pay out.

 

All my tools have been bought second hand (except hedge cutters that are getting delivered today ?) I don't have a tipper van so only paying out 1 load of insurance and tax, same with fuel, for a vehicle that is used for work and personal life. 

 

Hope I can grow and earn more but happy with what I have for now.

You seem to have looked at many of the ‘expense’ side of things but don’t forget that legitimate business acquisitions are deductible for tax. Plant and machinery and IT being 100% deductible as Annual Investment Allowance. 
 

Don’t get too bogged down in the perceived liabilities of self employment - there are many tax advantages to combining PAYE & SE status....  

 

Go for it!!

[eggsarascal]

8 minutes ago, kevinjohnsonmbe said:

You seem to have looked at many of the ‘expense’ side of things but don’t forget that legitimate business acquisitions are deductible for tax. Plant and machinery and IT being 100% deductible as Annual Investment Allowance. 
 

Don’t get too bogged down in the perceived liabilities of self employment - there are many tax advantages to combining PAYE & SE status....  

 

Go for it!!

Correct. And don't change your avatar, it throws my balance.

[Midge]

12 hours ago, kevinjohnsonmbe said:

You seem to have looked at many of the ‘expense’ side of things but don’t forget that legitimate business acquisitions are deductible for tax. Plant and machinery and IT being 100% deductible as Annual Investment Allowance. 
 

Don’t get too bogged down in the perceived liabilities of self employment - there are many tax advantages to combining PAYE & SE status....  

 

Go for it!!

True, thank you Kevin. When first looking into registering as self-employed all you read about is how much tax you owe or will owe, make sure your tax return is done blah blah so you think its all pay out when there are benefits to been a sole trader too!

 

I have just bought a pair of hedge trimmers which I should be able to claim back on. However I technically bought them before I registered the business so can I stay claim on them or not as they are older then the business?

[Dan Maynard]

Short answer, yes. Keep every receipt.

Once you are going you should ask local self employed people for a recommendation on an accountant, a good one will save you hours trying to work out the rules, take away risk of getting it wrong, and save you more in tax than the fees.

Longer answer

Can I claim for pre-trade expenses?

WWW.LITRG.ORG.UK

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On this page, we discuss pre-trade expenses and how you go about claiming them.

[Rough Hewn]

True, thank you Kevin. When first looking into registering as self-employed all you read about is how much tax you owe or will owe, make sure your tax return is done blah blah so you think its all pay out when there are benefits to been a sole trader too!
 
I have just bought a pair of hedge trimmers which I should be able to claim back on. However I technically bought them before I registered the business so can I stay claim on them or not as they are older then the business?

Phone hmrc.
I'm SE, and I regularly phone hmrc.
I politely explain my complete lack of understanding of the tax system and could they help me.
Normally the advisor will be very happy to explain the intricate and complicated system in an understandable way,
Especially when they aren't being shouted or sworn at.
Unless you're good at paperwork, might be worth paying a book keeper or accountant.
I'm looking at this now cos I'm not great with it.
Also they will be able to give you simple tax advice.
SE is liberating but will be a struggle at first, cash flow, machinery, staff, premises, training,insurance,vehicles,
Etc....
Plan carefully.
[emoji106]

[gary112]

I,ve been self employed 25yrs now and always had an accountant,it,s less stress,another thing i would advise is insurance against tax investigation aswell,its about 120 quid for the year,well worth it in my opinion