Hello, I've only jsut recently started earning decent money from my sites so it's gone from a hobby to something that I'll need to pay tax on and I'm not sure what to do. I suppose I'll need to speak with an accountant. I know a lot offer free consultations... should I go in with a list of questions? How do they work? Can anyone recommend someone in London? I don't want to hire an accountant to look after my business, I just need advice on how to get set up to pay taxes, what is tax deductable etc. Thanks!
If you don't get a qualified reply, repost this in a week or so and include British in the title. I'm in the US but generalized advice is to track income and expense by category. Every bit of prep work you do ahead of time will save you mega bucks at the CPA's office. You can use you own category titles for the first time as long as you have a description. Thereafter it will be cheaper to use category names as defined by the cpa.
If you are PAYE , you need to contact inland revenue telling them you are earning extra income , and they will send you a form every year that you will likely need to get an accountant to fill in unless you want to learn a new wheel , if you think you can handle it , you can even file your tax online. ifyou are self employed you will be gettingyour tax return every year anyway ,and you need to add yourextra income / expenses to it anyway. Most important thing is to keep receiptsfor EVERYTHING , bottom line is if you dont have a receipt you wont be able to claim as an expense so in effect it becomes taxable income. Its up to you , rememeber once you are in the system they are a sod to get rid of , they are freiendly enough to ask questions and give you advice ... call them direct . http://www.hmrc.gov.uk/ Typically accountants look for 1-1.5% of your turnover to look after your books and file your tax form ,unless thats likely to be less than £350 when the minimum charge will liekly be £300-£350 , thats my experience anyways . have fun PAUL
Looks like you may have found another Brit with some good advive. I don't know what your expenses are. Off the top of my head I would suggest for starters: domain reg fees, hosting expense,advertising,insurance, office expense (here the rules are cumbersome), travel and promotion. Claiming auto expense, which is my single biggest deduction for an offline business, might be hard to justify for an online business. Note the titles avove do not reflect an accurate tax form line. They are just generalizations.
Hey, I've recently setup as self-employed, whilst still working as PAYE. It seemed quite daunting at first, but it's actually - from my view - quite simple. I phoned HMRC, and registered as self-employed. Took around 5 minutes. Make sure you keep a receipt of EVERYTHING. Whether you bought it from your "personal" money for the business, or the "business" money for the business. Just keep a receipt. The only other thing i'm doing at the moment is making sure I write down every bit of money that comes in/goes out of the business account/personal account for the business, regardless of how big or small the amount. This can be done in a simple spreadsheet. I'm a member of a few other forums, and have spoke to some accountants/tax advisor's, and have been informed everything i'm doing is a-OK. I have only been self-employed for 7 weeks, but if there's anything I can help with, just send over a PM. Dan
I'd recommend listing your location too. Talk to friends/small business owners in your area for recommendations of a good accountant. That is the very best thing you could do.