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Register as self -Employed!!!

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dima
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Posts: 336
Joined: Mon Feb 16, 2009 12:38 pm
Location: London

Register as self -Employed!!!

Post by dima » Wed Nov 25, 2009 10:46 am

Hey all.

I am planning to register myself as self-employed, which I can do when being in a job. Can you pls help me to understand few points.

1. How do I register through HMRC.?
2. Do I have to pay any fee to regiser as self employed.
3. How do I pay Tax and NI? , Is there any lower limit to get tax exemption.
4. If, in a year No substantial profit comes in, even then Do I have to pay Tax and NI...

I am on Tier1 visa In London.

John
Moderator
Posts: 12320
Joined: Wed Nov 10, 2004 2:54 pm
Location: Birmingham, England

Post by John » Wed Nov 25, 2009 11:37 am

Using your numbering :-
  1. Go to the www.hmrc.gov.uk website, where all is explained
  2. No
  3. Being Self-Employed you will get a Self Assessment Tax Return each year. The liability on that will need to be paid direct to HMRC.
  4. If any profit is made you have to pay tax on it.
Roughly how much profit per year do you envisage making?
John

dima
Member of Standing
Posts: 336
Joined: Mon Feb 16, 2009 12:38 pm
Location: London

Post by dima » Wed Nov 25, 2009 12:21 pm

John wrote:Using your numbering :-
  1. Go to the www.hmrc.gov.uk website, where all is explained
  2. No
  3. Being Self-Employed you will get a Self Assessment Tax Return each year. The liability on that will need to be paid direct to HMRC.
  4. If any profit is made you have to pay tax on it.
Roughly how much profit per year do you envisage making?
Tx a lot John...

Not sure about the profit though!! I am expecting to earn around 9-10K per annum. I have perm job( Now shifting to Leceister), so this I would be doin whenI get free time and in the weekends..

dima
Member of Standing
Posts: 336
Joined: Mon Feb 16, 2009 12:38 pm
Location: London

Post by dima » Wed Nov 25, 2009 1:26 pm

Do we have to pay class2 NI from the day we start/register as self-emped?
I checked in the HMRC lnk, they have a form to be filled and in the form there is a section called class2 NI contributions... quite puzzled!!
:roll:

John
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Posts: 12320
Joined: Wed Nov 10, 2004 2:54 pm
Location: Birmingham, England

Post by John » Wed Nov 25, 2009 3:01 pm

Yes, the form you fill in not only registers you as a Self-Employed person for income tax purposes, but also for Class 2 NI contributions payable by the self-employed.

On the amount of profit mentioned by you you cannot claim Small Earnings Exemption from Class 2, and you will also be liable to pay Class 4 contributions on some of your profit.
John

dima
Member of Standing
Posts: 336
Joined: Mon Feb 16, 2009 12:38 pm
Location: London

Post by dima » Wed Nov 25, 2009 4:28 pm

John wrote:Yes, the form you fill in not only registers you as a Self-Employed person for income tax purposes, but also for Class 2 NI contributions payable by the self-employed.

On the amount of profit mentioned by you you cannot claim Small Earnings Exemption from Class 2, and you will also be liable to pay Class 4 contributions on some of your profit.

Oh.. Is like, day I register as self-emped with HMRC Do I need to start paying NI?( Class2 & Class 4).. I am still puzzled? My part time self empment is just now started... heheheh :o :roll:

John
Moderator
Posts: 12320
Joined: Wed Nov 10, 2004 2:54 pm
Location: Birmingham, England

Post by John » Wed Nov 25, 2009 6:56 pm

Class 2 is payable as from the date of commencement of your self-employment. I recommend that you set up a Direct Debit and they will take the money from your bank account once a month.

Class 4 is calculated on the profit made, and is payable direct to HMRC, That is, it is part of the money to be paid to HMRC following submission of your Self Assessment tax return.
John

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