Starting out - cash only?

[Planky1]

Hi,

Just wondered if when you all started out in your own business, mobile or home based, did you advertise as cash only to start with? I have no idea about card machines etc at the moment but I also believe you are allowed 6 months before you have to declare yourself as self employed to see if you continue with your business or not. If I use card machines to start with, won't I need a business account? Not sure what to do so any advice would be fab :)

TIA xx

[HWilliams]

Hi,

I'm on a phone, but will do my best to answer you.

Depending on where you are, the UK Inland Revenue require you to register as self-employed 3 months after your first paid work not 6. Failure to do so is a hefty fine so do watch that just in case.

For now, take cash if you are mobile/home based.

Most banks don't give a business account unless you've been trading 2 years though you can speak to banks regarding start up accounts.
Again, in the UK Barclays and Nat West are good for this.

Card machines are a different kettle of fish and to be honest, unless you have a salon it's not really worth it as mobile, it's just another thing to carry and may not work away from your line/network so then you'd be unable to process the transaction anyway!

Good luck, and hope I've helped x

[Planky1]

Hi,

I'm on a phone, but will do my best to answer you.

Depending on where you are, the UK Inland Revenue require you to register as self-employed 3 months after your first paid work not 6. Failure to do so is a hefty fine so do watch that just in case.

For now, take cash if you are mobile/home based.

Most banks don't give a business account unless you've been trading 2 years though you can speak to banks regarding start up accounts.
Again, in the UK Barclays and Nat West are good for this.

Card machines are a different kettle of fish and to be honest, unless you have a salon it's not really worth it as mobile, it's just another thing to carry and may not work away from your line/network so then you'd be unable to process the transaction anyway!

Good luck, and hope I've helped x

Thank you for that, I thought it was 6 months!!!! :eek: Still, 3 months is good, gives me time to set up and hopefully get a few clients in the door first ;) I am going to be home based, just wasn't sure what to do if someone was wanting to pay by card and didn't have the cash, so should I just explain when I first speak to them when they're booking then that it's cash only and not worry about or bother with a card machine? Would be nice to keep it as simple as poss anyway ;) xx

[Mike16300]

Hi

It's a tricky one this, as nowadays, most people want to pay by debit or credit card.
When I set up one of my businesses (not in hair/beauty), the bank gave me a business account, but wouldn't give me a credit card m/c, everyone else (worldpay etc) wanted previous history. I was selling a high value item, so no-one wanted to pay cash.
It seems it's impossible for a new starter to get going in this plastic fantastic world.

First though, find the location of the nearest ATM, so if a client doesn't have enough cash on them, you can advise where they can quickly get some (offer to look after their bags etc while they pop out and get some, to make sure they don't disappear, lol).

Secondly, have a look at Paypal, or other such like services, you may (and I haven't looked into this myself, so be careful) be able to get your clients to pay using Paypal from your computer at home. It's worth looking into in my opinion.

Good luck
Mike

[lee7smith]

I am a mobile hairdresser and only accept cash or cheques. No one has a problem with it, generally I think people expect to pay with cash for a mobile service ! :)

[Penny Vintage]

I am a mobile hairdresser and only accept cash or cheques. No one has a problem with it, generally I think people expect to pay with cash for a mobile service ! :)

I agree, ive also had no problems and not even had cheques to be honest. Some of the free advertising asks you to set out what payments you take anyway, which helps.

[shedunlop]

Although you have 3 months to register with the Inland Revenue you will still have to declare what you have earned to them on your tax return. Usually the setting up costs outweigh most of what you earn in the first couple of months at least but you must declare all of this. I think especially as you are going to advertise yourself as cash only, if anyone a bit tricky sees this they will interpret this as you not wanting to declare it. I understand this is not what you meant but the general public seem to think that anyone working on a self employed basis are automatically rolling in cas and don't pay any taxes whatsoever! I wish!

Cash only isn't a problem apart from when a client forgets to get the cash out for you. Cheques are no longer guaranteed with a card, that stops this year so machine is a good alternative once you are certain you are going to carry on and you are actually taking enough to warrant it. With most card machines you will need a business account although I think someone on here last week said there was one that didn't. Business accounts usually come with a year's free banking so you won't pay charges in that first year, some are 2 so shop around.

Good luck in whatever you decide to do my darling, it is all very exciting. :wink2:

[Planky1]

Wow, some really helpful replies there, thank you so much everyone. It's certainly a mind field and no where near as simple as I thought it was going to be!! There's so much to think about isn't there? I will give it some more thought and I bank with Natwest so I might pop into my branch and just speak to them about it maybe? They go on and on about wanting people to work, get off the doll etc and set up their own businesses, yet they make it so hard to do!! :rolleyes:

[Planky1]

Although you have 3 months to register with the Inland Revenue you will still have to declare what you have earned to them on your tax return. Usually the setting up costs outweigh most of what you earn in the first couple of months at least but you must declare all of this. I think especially as you are going to advertise yourself as cash only, if anyone a bit tricky sees this they will interpret this as you not wanting to declare it. I understand this is not what you meant but the general public seem to think that anyone working on a self employed basis are automatically rolling in cas and don't pay any taxes whatsoever! I wish!

Cash only isn't a problem apart from when a client forgets to get the cash out for you. Cheques are no longer guaranteed with a card, that stops this year so machine is a good alternative once you are certain you are going to carry on and you are actually taking enough to warrant it. With most card machines you will need a business account although I think someone on here last week said there was one that didn't. Business accounts usually come with a year's free banking so you won't pay charges in that first year, some are 2 so shop around.

Good luck in whatever you decide to do my darling, it is all very exciting. :wink2:

It is very exciting but very daunting too!!! Especially as things are beginning to get a bit more complicated than I had imagined. Still, it's all good learning processes ;) :)

[Planky1]

Oh and there is a cash point about a 1 minute drive form my house, so no excuses ;) LOL

[Mike16300]

Hi

Another thing to remember is that the terms and conditions for card use are not all the same.
I have a friend who takes card payments with a facility from her bank:-
She has to rent the machine
She pays a large percentage in fees as her turnover is low
She has to wait 3 months for the money to be available

She only takes cards as a last resort, obviously!

If you find your clients do want the flexibility, shop around!

Mike

[Planky1]

Hi

Another thing to remember is that the terms and conditions for card use are not all the same.
I have a friend who takes card payments with a facility from her bank:-
She has to rent the machine
She pays a large percentage in fees as her turnover is low
She has to wait 3 months for the money to be available

She only takes cards as a last resort, obviously!

If you find your clients do want the flexibility, shop around!

Mike

That's great, thank you for your help. Think I may just say cash only, seems to be the much easier option ;)

[Pinkbunny28]

Sorry hun to change what everyone has said but I went to one of those free 'newly self employed' workshops from hmrc and they said that you MUST register whenever you start doing one of the following whichever is first: 1) you are marketing/advertising or 2) you have clients and are doing business with them.
They said they USED to allow 3 months but have toughened up on it. If in any doubt please just give them a call. Wouldn't want you getting fined so thought I'd let you all know. (I went on this workshop on 5 July so recently)

And I don't think no card machine is an issue. As someone else said, not a lot of people expect to pay by card for mobile services.

Hth x

[Planky1]

That's great, thank you for your reply, I'd best give them a call then as I want to do everything above board ;)