Registering self employed with a day job too

[Citrinerose]

Hi everyone,

I work full time in admin and have slowly been getting trained up in various beauty treatments. I have my first proper paying customers tomorrow and I need to register self employed. How many of you also have a full time day job and are registered self employed.

Do I need to keep my wages and anything to do with beauty treatments in separate accounts ? I already have an old current account from when I wasn't married so planning on using this for anything self employed related but really not sure how it will affect my full time job. The idea is to eventually take down my admin hours and work more as a therapist but certainly for now I will be keeping my hours until I build up enough of a client base.

Any help appreciated. x

 

[Jay RS]

Hi Cintrinerose, i too worked full time whilst staring up my own place and as i got busier i cut down my hours in my full time job as my employer was really supportive and even comes for treatments, great whenever your employer is your next door neighbor too!

Before i had opened my business i registered as self employed as i was able to start my books there and then as i was buying stuff in (make sure you keep all receipts!). In relation to accounts it depends whether or not your using cash or you will be taking card payments aswell, currently i do not accept card payments so i don't have that problem, however when the time comes i will be setting up a separate account for my business as will be easier looked at for you and your accountant.

Final point lol, keep all your pay slips from your full time job and pop them in with your books for your accountant to do, as they will be able to incorporate it in with your self employed job.

 

[hazelb]

You need to tell the revenue your are planning to go self employed. Then keep acurate records of income and expenditures ( for the business )
You will need to complete a tax return.

Your normal PAYE job won't change and tax will still be collected trough your wages. You will then need to pay additional tax on any profits you make through being self employed which will be collected as a lump sum in Jan and July each year.

 

[Citrinerose]

Hi Jay,

Thats so helpful thank you. You are the second person who has recommended to always accept cash to begin with and keep a record. Sorry if this is a silly question but when you are being paid cash do you still put it into a bank account as I buy most of my stuff with a card online, or do you keep the cash seperate ? At the mo I have a joint accuont with my husband and one I've had from teenage years before I was married so was planning to use that one to keep it all seperate.

Thanks for the advise

 

[Jay RS]

Hi Jay,

Thats so helpful thank you. You are the second person who has recommended to always accept cash to begin with and keep a record. Sorry if this is a silly question but when you are being paid cash do you still put it into a bank account as I buy most of my stuff with a card online, or do you keep the cash seperate ? At the mo I have a joint accuont with my husband and one I've had from teenage years before I was married so was planning to use that one to keep it all seperate.

Thanks for the advise

No problem! I don't put my cash into a bank account as of yet as i buy a lot of stuff with cash but don't get me wrong i also buy a lot of stuff on my personal card too and if i do that i just keep all the receipts record it down and then can give bank statements when im doing the tax return and highlight whats been spent on my card, if your using different cards just write it down against each thing you've purchased which card it is ie, yours, your husbands, joint etc. Its honestly easier than it seems, just make sure you have all your intake and expenditures wrote down, make sure you've done a total value for each month, also don't forget if your doing any training's or need to go somewhere to buy something for your business, work out the mileage both there and back and keep fuel receipts! I will be using my accountant for the first 2/3 years just to fully understand how to correctly do a tax return online and then i will be doing it myself as i have a pretty fair idea what im doing just want to make sure im 100% confident.

 

[holisticzoe]

I have an old account that I pay cash into so I can easily pay my tax in January. I also work 12 hrs a week at a cafe and self employed the rest of the time, I use my cash for day to day and pay what's left into normal account, I don't accept card either so just don't bother with a business account. It's very easy to file your tax return at the end of the year, just keep a spreadsheet of all incoming and outgoing and the actually filing it, as long as you don't have other money coming in from pensions etc is very easy.

Hopefully this helps a bit x

 

[Lisa32]

Sorry for jumping on your post but I'm in the same position. How much do you put by each month for additional tax from self employed? This is where I get confused? Xx

 

[Jody2412]

If you earn over 10k you pay tax. I would put by 20% of the weekly takings. If you earn less you will need to still pay national insurance but your workplace may cover it. This is for any takings over 6k or 8k approx x

 

[Citrinerose]

So for anyone else looking I talked to a friend who is also an accountant last night. She said a small business like what i'm doing, just use your regular account - having a seperate account is only really needed when you are LTD company. Record any business incomings and business outgoings on a book or spreadsheet and dont worry about all the other bits that come out in between in your account that are non business related. Keep all receipts for business expenditure, invoices for payments (I just got a little receipt book for this) and keep all payslips from the full time job. Sounds a lot more simplified now

Please do say if anyone knows the above is incorrect but this is the simplifed interpretation of what she told me I need to do x

 

[AcidPerm]

Whether you operate a separate bank account just for your business is entirely up to you.

However, if you find that you fritter money away when it's sat in your purse, you might find it easier to keep business related finances completely separate in a lockable cash tin, if you don't want to open a second bank account.

 

[Citrinerose]

Whether you operate a separate bank account just for your business is entirely up to you.

However, if you find that you fritter money away when it's sat in your purse, you might find it easier to keep business related finances completely separate in a lockable cash tin, if you don't want to open a second bank account.

Thats really good advise thanks. Very true! I will definately be getting a cash box/tin but I still want to be able to offer card payments too for instances where customers do not have cash so thinking about getting one of those izettle machines. Their rate seems quite competitive compared to paypal

 

[CFBS]

I keep my salon money separate to personal money. i also have a salon savings account where i put away money for tax, NI and saving up for new equipment. I would get very confused with salon money going through our personal account - far too complicated to track!
This way i can reconcile my computer spreadsheet to the salon account easily.

Now, all I need is a way of stopping hubby delving into my till like his own personal cashpoint!

 

[hazelb]

The tax man is only interested in your profit. He's concerned about your takings ( income ) and your expenditiure ( expenses )

He's not interested if you keep cash under your bed, in a pillow case or pay it into your mums bank account.

You will need to have some sort of an account so you can pay cheques in and make DD payments (but that can still be a personal account)
You may find it easier to keep money in a separate bank account so it doesn't get mixed up with your normal money or frittered away..but that is up to you. I use a different account then I know every transaction that is on my statement is a business one. They may all not be allowable expenses for tax purposed, but at least I can spot them easily.

As for putting money asside for tax. Save 20% of your proffit.
If you are working PAYE that will use up your 10k tax free allowance. If you are not and are just self employed, then you can give yourself a bonus when you've paid your tax bill.