Tax condundrum...

[toastking]

I have been looking this up online and through the forums without great success as I think ideally I just need to speak to someone with a bit more experience. My scenario...

- I have a full time job and basic salary
- I have a car allowance, pension and student loan considerations
- I work in sales so have fluctuating commission (months can vary massively in terms of take home)

Now this is all fine and dandy, my company and the tax man generally work it all out and I check using online calculators and we all go home happy. However I have been asked to build a website for someone and financially/tax-wise I am in no way ready to handle it:

- I will be receiving a one-off sum for building/re-building the website based on content provided
- I am not registered as a business entity
- To throw a spanner in the works I am building a company around sales, marketing and startup education so will be, at some point, registering as a business...

What should I do? Simply wait till the end of the year (i.e. march) see if I've picked up more side-projects and declare them all at once having retained a good 40% to pay the taxes? Or am I missing a trick here?

 

[katykicker]

I'm away from my laptop so will struggle to fact check properly but I believe you need to declare all work within 3 months.

When I registered as a sole trader, to declare all my online work, I had a 3 month period in which I could backdate it.

I then just file a tax return online each year also telling them my salary from my P60 and any other income/outgoings.

If you haven't already registered, which it sounds like you haven't, you should be looking to do that now. You should keep a record of incomings and expenses and then after the tax year you can file. You can use your p60 to tell the taxman what you earned in your real job. You don't need 40% savings though, but that would finitely be safe.

Www.listentotaxman.com is great for checking amounts. Especially as presumably you'll have no tax free amount, as you already work.

 

[katykicker]

Also, just to add, you should already be declaring any extra income you make
Online. Cash or vouchers. Surveys, mystery shopping, etc.

 

[Julesfh2012]

Yes Katy is right I think there is a finite period of time that you have to declare. However my experience is that they aren't overly strict on this timeframe.

I would ring them. I've always found them very helpful and it saves time trawling through their documentation.

Will you have to consider NI aswell?

 

[Jon]

yeah was gonna say, you must already be registered as self employed as you are doing work from home stuff already

 

[toastking]

I've never really consistently earned money from home on these things but I think you're probably right I should be registered to cover things as I do square £200 easily per year outside of work and this will go up when I do the freelancing more.

In the past the freelancing efforts have been attached to others who sorted the taxation etc. so I never got round to registering etc.

So by the sounds of it

- speak to the taxman about what my scenario demands
- register for self assessment based on their advice
- back in time for tea