Being Self Employed whilst also in full time employment?

[matt_vtr_15a]

Accountacy is not my forte unfortunately but I know of several members clued up on here who may be able to give me advice or people in the same situation.

I have a friend who is high up for an accountancy firm but she specialises in corporate tax so not sure if she will be able to advise on my situation, she's quite busy at the moment so can't get to see her until the weekend for advice.

Soo....

I'm an Architectural Technologist employed and paid a salary with bonus's based on a 37.5hour working week. This is of no issue, the company accountant sorts all that out. (I can't approach her unfortunately about my own business, it needs to be kept separate and my employer doesn't need to know about it)

After doing a couple of friends favours as well as some of my dads mates I have reached a point where I'm getting a ridiculous amount of requests to do planning applications, buildings regs, construction drawings etc. for developments ranging from residential to industrial.

To take on these jobs I really need to become self employed on the side and operate my own small business to keep it all legit.

Are there any implications of being employed and self employed? I don't particularly want it to get back to my boss.. so i'm not sure if it would change my tax code etc. of what the accountant currently does or can it be kept completely separate?

Ideally I just want to do the following

- Mon-Fri (Employed job)
- Weekends/Evenings as and when it suits me (Self-Employed Job)

All i want to do is do the jobs on the side, pay my tax and keep it all legit and see to where it may lead.

Is it also worth becoming vat registered?

I have recently purchased a macbook pro, auto cad, sketch up and photoshop etc. costing a substantial amount of which it may be worth claiming back the vat?

I'm fully set-up and will be working from home with not really any additional expenses now except for petrol for visiting the various sites etc. unless i'm overlooking something i could be claiming vat back on?

(just not sure if it's worth it or not in the long run)

Any help would be appreciated.

Thanks :y:

[Jonny52002]

Morning Fellow Technologist lol.

Its pretty straight forward to be honest sorting out your taxes, I was self employed from August 2011 while also doing other part time work up until the start of this year. Basically to start with you will need to register for Self Assessment with the HRMC and keep records of your accounts (invoices). Come the end of the tax year you can go online to do your self assessment and put in what you've paid from your employer using the information from your P60. Then fill in the details of your extra earnings. They will then tell you if you owe any additional tax (which you will) and give you the payment date for that which is usually the following January and July (its gets split into two payments). You may also have to make some additional National Insurance contributions of around £13 a month.

In terms of VAT, I personally didn't bother as I was basically working as a consultant so only claimed for my minor full and phone usage, you also have to pay to be VAT registered and be a registered company, which would mean you have to file all your accounts to another governing body (forget the name) which is a massive undertaking.

Hope this helps.

P.S I would suggest putting a little money aside from any extra earnings to cover the additional tax you will need to pay come the end of the year. (I didn't put enough a side and it put me on the backfoot over the next year)

[matt_vtr_15a]

Very helpful, in that case becoming VAT Registered is of no point, it's more of a one off initial set-up cost than ongoing cost as you know.

That seems much more straight forward than I expected, I already have several invoices for work I have done so I will get Registered on to self assessment.

Fortunately all income earned from this venture will just be moved into one of my Savings account and left un touched. So the tax can be deducted prior to spending it etc.

Really helpful cheers mate, I expected there to be some underlying issues I hadn't considered :y:

[D4MJT]

Fortunately all income earned from this venture will just be moved into one of my Savings account and left un touched, until I see some sweet group buys on the MLR for shiny things that make the evo go fast and bang more.

EFA ;)

[Giraffe]

Lol what, have to be a company to be vat registered? No.

It's not worth it though, because you would have to charge and pay VAT on everything as well.

Other than that, register self employed and do tax returns, they are straight forward enough or an accountant could do it for you for a couple of hundred I should think.

[matt_vtr_15a]

EFA ;)

Extremely fucking awesome?

It has been said :P

(EDIT) Fuck sake just realised you edited my post, probably correct haha!!

Lol what, have to be a company to be vat registered? No.

It's not worth it though, because you would have to charge and pay VAT on everything as well.

Other than that, register self employed and do tax returns, they are straight forward enough or an accountant could do it for you for a couple of hundred I should think.

Cheers Dave :y:

I'm fairly organised at keeping everything together and in order so I should be able to sort out my self assessment, I could even visit my mum to help with such things as she does the self assessment for my dad.

Just wasn't sure if my scenario complicated matters with being employed and self employed.

Definitely ruling out the VAT registering, just not worth it as I don't have any ongoing costs such as materials etc.

[Jonny52002]

No Problem Matt, good luck with it.

Giraffe, I could be wrong (and probably am), was my understanding from looking into things that to charge and claim back VAT you needed to be a registered company and file a full set of accounts to companies house.

[Giraffe]

No Problem Matt, good luck with it.

Giraffe, I could be wrong (and probably am), was my understanding from looking into things that to charge and claim back VAT you needed to be a registered company and file a full set of accounts to companies house.

Yeah you're definitely wrong mate. Basically if you run a business of any description then you can register voluntarily or have to register if your taxable turnover goes over the 79k threshold.

Not sure how it might work for you Matt, because generally supplies for new builds are exempt or zero rated (I forget which) but if you mainly do new builds and it is zero rated, might be worth it because you might be in a situation where you can reclaim more than you pay, but for anything other than new builds, you would have to charge.

[marcusd]

When I was working a job and also self employed I was able to claim a certain amount of vat back, it depends on how much you earn, I wasn't earning mega money Maybe 2-300 a week on good week's, and paid a accountant to sort all stuff, and basically had 3/4 petrol paid and some towards tools wear n tear on car didn't work out too bad and with accountant they sort what you can actually claim and things you might not think of.

[matt_vtr_15a]

Yeah you're definitely wrong mate. Basically if you run a business of any description then you can register voluntarily or have to register if your taxable turnover goes over the 79k threshold.

Not sure how it might work for you Matt, because generally supplies for new builds are exempt or zero rated (I forget which) but if you mainly do new builds and it is zero rated, might be worth it because you might be in a situation where you can reclaim more than you pay, but for anything other than new builds, you would have to charge.

In terms of materials I'll only ever need to specify, I'll never be outlaying money for materials etc. Only providing working drawings, project management etc.

The majority of work I do is extensions to houses, and extensions to industrial buildings, and a bit of something in the pipeline which is the reason for having to go this route which is along the lines of property development as a joint venture with a friend who has inherited a considerable amount of land. Some being greenbelt but has potential to be developed.

The only expenditure I'll have really is petrol costs to visit clients etc. But most will be local, so not a massive issue.

When I was working a job and also self employed I was able to claim a certain amount of vat back, it depends on how much you earn, I wasn't earning mega money Maybe 2-300 a week on good week's, and paid a accountant to sort all stuff, and basically had 3/4 petrol paid and some towards tools wear n tear on car didn't work out too bad and with accountant they sort what you can actually claim and things you might not think of.

its something I'll weigh up, for the line of work I'm in it's not like I'll be buying tools, clothes etc. For work. As I already have them noe so eill be sorted for the next couple of years or so.