Any tax experts or Accountants on here.....

Who can give a free paragraph of help before I join the rude/Trollee money forums to get an answer....

Simply.....

I work full time and pay income tax at the standard rate.

I have earnt about £200 from writing this year which I would like this to be 'legal' earnings. The government website says about a £2500 threshold before I have to fill out a self assesment... does this mean I get any self employed earnings up to that amount tax free or do I have to inform them another way so they can add it to my tax code? I could easily produce receipts for materials/home office etc to offset any tax liabilities I just cant be bothered if I don't have to.....
 

accountantpete

The Joy of Six - One Pint Left
When you say "this year" I presume you mean 6/4/14 -5/4/15 which is the current tax year.

Whilst there may be an earnings limit to register as self-employed you still need to declare other income via a tax return. So if you earned say £1500 from writing after expenses you would be expected to ask for a tax return for that year and declare the £1500 income on that form.

However in your case the £200 income is easily offset by costs - you can estimate 'Use Of Home' costs (light/heat/rates etc) and add that on to the direct costs to cover the £200 so that no profit is made. HMRC are a bit pushed as regards workloads so I don't think they will mind you not troubling them.^_^
 
When you say "this year" I presume you mean 6/4/14 -5/4/15 which is the current tax year.

Whilst there may be an earnings limit to register as self-employed you still need to declare other income via a tax return. So if you earned say £1500 from writing after expenses you would be expected to ask for a tax return for that year and declare the £1500 income on that form.

However in your case the £200 income is easily offset by costs - you can estimate 'Use Of Home' costs (light/heat/rates etc) and add that on to the direct costs to cover the £200 so that no profit is made. HMRC are a bit pushed as regards workloads so I don't think they will mind you not troubling them.^_^
Many thanks... yes I mean current tax year ending in April 2015.... I figured cost incurred could be offset against spending (proportion of internet/heating/printer ink etc) but wanted to be legal but understand about not bothering them.

I reckon someones time and red tape at the tax office processing my nil self employment tax would gobble up a lot of my PAYE tax!!! I will keep records of payments and outgoings just in case I ever get chased by them
 

Spinney

Bimbleur extraordinaire
Location
Under the Edge
Be aware that use of home costs can have implications when you come to sell your house - I can't remember the details, but there are various ways of going about it. Some of these ways count part of your home as a place of work, and thus liable for capital gains tax when you move.

(I work at home - I claimed this sort of thing in my last house, but no longer bother as the amount it saved wasn't worth the potential faff/capital gains liability).

I don't think they spend any time at all processing your form - you do it all online these days, and the computer comes back with an instant bill!
 
Don;t do it now though is you're still in the current tax year. It is not due until Jan '16 and potentially you could earn more between now and 5th April.
 

PK99

Legendary Member
Location
SW19
Be aware that use of home costs can have implications when you come to sell your house - I can't remember the details, but there are various ways of going about it. Some of these ways count part of your home as a place of work, and thus liable for capital gains tax when you move.

(I work at home - I claimed this sort of thing in my last house, but no longer bother as the amount it saved wasn't worth the potential faff/capital gains liability).

I don't think they spend any time at all processing your form - you do it all online these days, and the computer comes back with an instant bill!

IIRC, that only applies if you dedicate a part of the property to exclusive business use on which you charge to tax all the costs. If you work in the dining room, there is no issue.

I used to work from home;
Charging a proportion of heating, phone etc coats was not a problem.

Now there is a Simplfied System: > https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home
 

slowmotion

Quite dreadful
Location
lost somewhere
I have a full-time salary. One year I earned a couple of hundred pound from my brother in law for delivering a couple of antiques. When I filled out my tax return I just put the £200 in the "other income box". HMRC will calculate the tax on the total amount that you earn. The next year they calculated my tax code assuming that I was going to earn another £200 on top of my salary. I phoned them up and told them that this was not the case and they readjusted the code to suit. Don't be afraid to ring up HMRC for advice They are extremely helpful.
 

CopperBrompton

Bicycle: a means of transport between cake-stops
Location
London
My accountant strongly advised me to use the flat-rate system PK99 linked to:
https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home

I have a room in the home which is used as an office most of the time, a second living room sometimes and a spare room (sofabed) occasionally, but his view was that as it was mostly an office there would be a capital gains risk if I apportioned the costs. I take no chances with tax so use the flat-rate scheme.
 

accountantpete

The Joy of Six - One Pint Left
My accountant strongly advised me to use the flat-rate system PK99 linked to:
https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home

I have a room in the home which is used as an office most of the time, a second living room sometimes and a spare room (sofabed) occasionally, but his view was that as it was mostly an office there would be a capital gains risk if I apportioned the costs. I take no chances with tax so use the flat-rate scheme.
TBH I recommend using this to my clients however a couple of years ago a guide for the use of staff went up on the HMRC website about Use Of Home. It stated that there should be no Capital Gains Tax implications from claiming and that expenses like Council Tax and Insurance should also be allowable as a basis for the calculation.

The guide mysteriously disappeared after a couple of weeks and has not been seen since!
 

byegad

Legendary Member
Location
NE England
Wot accountantpete sed. If you don't do this HMRC can charge you for the last six years undeclared income, plus swingeing interest and anything else they can think of!
 

Spinney

Bimbleur extraordinaire
Location
Under the Edge
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