How do you become self-employed?

Z Z

ZenHalfTimeCrock

Well-Known Member
Joined
18 Apr 2019
Messages
1,594
Team supported
Manchester City
Nothing to do with the Coronavirus but I am starting this thread because I am contemplating becoming self-employed.

The problem is that amidst the blizzard of online information about this, I can't find a link that permits someone to apply for this status or a number to ring to set the ball rolling.

It's a bit like being in an unfamiliar supermarket where you are searching for an item that you can't find and then discover that you have walked past it several times already.

Is there anyone who knows how to set about this?

I was self-employed once before for a year or so about a decade ago but have forgotten what all this entails.

Thanks in advance if anyone can help, maybe by providing a link, especially given that many of those who already have this status are struggling in the present situation.
 
ZenHalfTimeCrock said:
Nothing to do with the Coronavirus but I am starting this thread because I am contemplating becoming self-employed.

The problem is that amidst the blizzard of online information about this, I can't find a link that permits someone to apply for this status or a number to ring to set the ball rolling.

It's a bit like being in an unfamiliar supermarket where you are searching for an item that you can't find and then discover that you have walked past it several times already.

Is there anyone who knows how to set about this?

I was self-employed once before for a year or so about a decade ago but have forgotten what all this entails.

Thanks in advance if anyone can help, maybe by providing a link, especially given that many of those who already have this status are struggling in the present situation.
Click to expand...

Good place to start below if you are going to use paye could be an advantage to pay yourself a wage for government NI contribution if so will need to register for paye and turnover dependant VAT aswell.

https://www.gov.uk/log-in-file-self-assessment-tax-return/register-if-youre-self-employed
 
Two ways you can do it. As a sole trader or a limited company. The advantage of the former over the latter is that it's less administrative hassle. The downside is that you'll be liable for any and all debts incurred by the business whereas with a limited company your liability is limited to what you yourself invested in the company.

Whichever you do, you'll have to notify HMRC and set up appropriate NI payments and you may have to register for VAT depending on your turnover. You'll have to prepare accounts annually and do a tax return of course. If a limited company you'll pay Corporation Tax on your profits and income tax on any money you take out. As a sole trader you'll just pay income tax on earnings.

It really all depends on what you're doing, how much you expect to turn over and how much risk you want to take.
 
Last edited:
Many thanks for the replies. They are very much appreciated.

My current situation is that I am about 20 months away from retirement and living off personal savings. Not going on holiday for 15 years and living frugally have put me in this position. Previously, I spent my career in education.

Although the public exam boards are not setting papers this year, I have a contract to do some marking that has not been rescinded and should carry over into the next cycle when things settle down a bit.

I am also a published author in my subject area (just a couple of chapters in some popular books for the general reader but both have garnered decent reviews on Amazon over here and in the US) and have an idea for a unique revision guide that may bear fruit if I can generate some interest.

Private tuition is another option.

None of this is likely to generate much income but I have been wondering whether to seek self-employed status for the duration of the period described as I think I might be eligible do so. It is also a way to keep up NI payments via the Class 2 method.

So that’s the back story. Setting up as a sole trader looks like the best option based on the replies so far.

Once again, thanks for the responses.
 
ZenHalfTimeCrock said:
Many thanks for the replies. They are very much appreciated.

My current situation is that I am about 20 months away from retirement and living off personal savings. Not going on holiday for 15 years and living frugally have put me in this position. Previously, I spent my career in education.

Although the public exam boards are not setting papers this year, I have a contract to do some marking that has not been rescinded and should carry over into the next cycle when things settle down a bit.

I am also a published author in my subject area (just a couple of chapters in some popular books for the general reader but both have garnered decent reviews on Amazon over here and in the US) and have an idea for a unique revision guide that may bear fruit if I can generate some interest.

Private tuition is another option.

None of this is likely to generate much income but I have been wondering whether to seek self-employed status for the duration of the period described as I think I might be eligible do so. It is also a way to keep up NI payments via the Class 2 method.

So that’s the back story. Setting up as a sole trader looks like the best option based on the replies so far.

Once again, thanks for the responses.
Click to expand...
I certainly agree that sole tradership looks entirely appropriate for your circumstances and expected moderate income level. It will be much simpler and cost less in accountancy fees than, say, a limited company.
 
Many thanks again for the replies.They are much appreciated.

Fortunately, I know a bit about accounts as 40 years ago I spent a couple of years as a Junior Audit Clerk (the most famous client of one company was Tony Wilson).

I have checked and my previous NI contributions are looking good.

It may just be that I will earn next to nothing, probably a few hundred pounds next year in the 2021 cycle.

But it's not necessary for this business to succeed. It's the NI that I am more worried about as Class 3 seems to work out at £770 per year.
 
You must log in or register to reply here.
Unread Posts

Don't have an account? Register now and see fewer ads!

SIGN UP
Back
Top