Neanderthal

iTrader: (6)

Been out of work since the end of Jan. I've applied for loads of jobs but not really had a sniff of anything.
That was until last week when I was approached by my former company asking if I wanted to do some work for them as a consultant. Wouldn't be massive pay but more than my job seekers allowance.
At first I turned them down, as they couldn't promise any follow on work. However, in the mean time I've been contacted by two more companies asking about whether I'd be available to do some work for them.
I've never been 'self employed' so I'm not sure what exactly is involved. I definately won't be bringing in the amounts that I'll need to register for VAT so is it just a case of letting the tax office know that I'm now self employed?. Then keep track of everything I earn ready for self assessment next year?
I've got another 3 years of the current mortgage rate so hopefully I'll have a few years worth of accounts as I know getting loans etc is much harder for self employed people.

I quite like the idea of being my own boss etc, but worried about potential pitfalls I know nothing about!
Any advice would be great.
Matt

JackClark

Just crack on, but make sure you tell the tax and benefit office.

pwhittle

just phone HMRC and tell them - that's the formalilies over with. Obviously you'll need to do a tax return, so keep a record of all mileage, costs, income etc.
Business Link do a huge range of free workshops.

go for it

Matteeboy

Do a basic bookkeeping/accounts course. May sound duller than a Perodua but it's helped me out no end over the years running a business.

Then go for it.

john banks

Consider your insurance needs (professional indemnity, public liability etc).

Pitfalls include irregular work, unpaid holiday/pension.

Nurse Gladys

As above, your local Business Link will be able to offer you a free one-to-one consultation, and they also do a lot of free workshops. They can also tell you if there are any start up grants available.

Also go onto the HMRC website and follow the links for becoming self employed. The tax office has a Business Support Team in each area, who again run free workshops which will tell you exactly what you need to do, what records to keep etc.

The initial two courses you ought to do with HMRC are

Becoming Self Employed
Self Assessment for the Self Employed

Make sure you do them in that order as they follow on from each other.

They should also be able to tell you about the free VAT seminars in your area.

These guys are really helpful, friendly & knowledgeable - in fact they are known as the Inland Revenue's Best Kept Secret!

Don't be put of by who they are, they are seriously out to help you avoid the pitfalls, and are not obliged to report any mistakes etc to the rest of the office!

Hope this helps & good luck!

David Lock

All as above and it really is more straightforward than you might imagine.

I'd say the main thing is to keep records of every item of income and expenditure along with proof if possible. So if you put an ad in a shop window then note the cost down. At the end of your financial year you can legitimately claim for all those little things you would normally sling out, and that can add up.

You can register for VAT at any time but unlikely to be worth it for a small turnover and it is extra work. Many will do it to look as if they are bigger than they are and mostly supplying to the "trade". But if, for example, you planned to spend a lot on new office equipment then it might be worth it.

Note you can be employed and self-employed.

Tax folk are surprisingly helpful. They just like to know what is going on.

Don't try and fiddle things like non-real expenses or hide any invoices. Remember your assets are at risk if you **** things up and get sued but insurance will help.

Best of luck. dl

Neanderthal

iTrader: (6)

Thanks everyone
I'll have a read of the HMRC website.
Oddly enough, I've just had a phone call asking if I'll be available for a telephone interview on Monday for a job I applied for a couple of weeks ago. Not big money but again, loads more than job seekers allowance. If I get that maybe I can still do the consultancy work as well.

MattW

Matt

Some companies may require you to be limited. Certainly the case in the IT world.

If you need any advice about that please ask.

chocolate_o_brian

iTrader: (22)

Can't offer you any advice, but with you genuine luck with your adventures