Self Employed Regulations Going Self Employed

If you are thinking about going self employed you’re going to have to notify a few people other than your friends and family that this is what you intend to do.
Unfortunately the government always wants it’s slice of your income for tax and national insurance and doesn’t want any of that slipping away.

The day you start self employed

Whether or not you are doing a bit of extra work on the side whilst you still have a full time job and paying PAYE and standard national insurance, or if you are going it completely alone, you still need to tell the Inland Revenue that these are you intentions.
You need to send notification into the Inland Revenue no more than 3 months after the month you went self employed.
Generally this is the end of the matter at this stage, because the IR just want to know what you are doing.
Find the tax office that currently services your PAYE and notify them.
Failure to send in notification will get you a penalty and have you down as not abiding by the laws of the land. It’s simple to do and only takes a few minutes so off you go.

Self Employed Regulations
What regulations affect you? Starting and running a business means to have to comply with certain government regulations. You’ll need to keep certain records and fill in forms as you go by.

Here are some of the basic requirements your small business needs to know.

VAT regulations

It is your responsibility to register your business for VAT.

You must register for VAT if:

• at the end of any month the total value of the taxable supplies you have made in the past twelve months or less is more than the current threshold - £58,000 and
• at any time you have reasonable grounds to expect that the value of your taxable supplies will be more than the current registration threshold in the next thirty days alone.

These rules also apply when you take over a business as a going concern (see Notice 700/9 Transfer of a business as a going concern). It doesn’t matter whether the last owner was registered:

• if the business is trading at a level above the limit then you’ll need to register and
• your date of registration will be the day you take over the business.

To register for VAT you must complete Form VAT 1, which you must send to Customs and Excise within 30 days of any of the above.

If your business has a turnover below this threshold you can register voluntarily.

There can be a business advantage in doing this.

If you are considering voluntary registration you can get further information from the Customs and Excise National Advice Service Enquiry Line on Tel 0845 010 9000 or online at www.hmce.gov.uk.

PAYE regulations

PAYE (Pay As You Earn) is the Inland Revenue system for collecting income tax from the pay of employees, including directors, as they earn it.

As an employer, you need to deduct income tax and National Insurance contributions (NICs) from your employees’ pay and submit the deductions to the Inland Revenue.

Many employers decide to use an outside supplier - usually an accountant - to run their payroll for them. An experienced accountant can tell you what systems and forms to use, making sure you don’t miss out any essential steps.

Get a starter pack by calling the Inland Revenue New Employers Helpline on Tel 0845 60 70 143. The pack contains taxable pay tables and pay calculators, as well as all the essential forms and information.

More information is online at the Inland Revenue site at www.inlandrevenue.gov.uk