Tax when running a small business (UK)?
I have been working as a self-employed tutor for a number of months now. I have recently decided to turn this into a small 'official' company. I will have a couple of people working for my company, but not under official contract. I'm very new to all of this and the technicalities of business have never come easily to me. I had planned to do where parents of tutees pay us online via transfer and then I pay tutees the fair majority of takings. Bookings etc would be via the company but employees would be completely in charge of their own hours and holiday etc. We don't and won't have a premises so admin I'll be doing from home and tuition will either be online via the lies of Zoom or hopefully eventually in person in the student's own home. I don't know if the latter I'll have to do anything for in terms of insurance... own cars will be used. So my question really is, what do tax and other legal 'things' do i need to do for this. I don't want to be fined etc by HMRC or other for not doing or filing something or for unintentional tax evasion for example!! Most of my employees will be under 25/ still in university so i want to be as knowledgeable as possible to prevent confusion and difficulties for them. While my business is of course formal, only people I know or have been recommended to me by others will work for me. TIA
- Jackie MLv 76 months ago
The people you have working for you have to let inland revenue know they are self employed and where they get the money from as it is taxable income and their tax code will change if they are using their car for business use and they will also have to let their car insurance company know car is used for business use just as you will have to do the same, you also need various business insurance and liability insurance and let the council know you are using your home for running a business even if you own the home but in general call tax office and they call the tax office and they will help you - you also have to keep a record of all financial details and money paid to others as the tax office will want to know the info each year - this is the basic details but enough to get you started
- TavyLv 76 months ago
Starting a U.K. company is time consuming and complicated, you can look this up on HMRC site.
You would be better off registering as self employed and either paying these people one off payments and let them declare their own tax.
I suggest you talk to an Accountant in your area.