Self-employed questions....

[yve93]

top of the morning to ye geeks!

I've got some work in a salon and setting myself up as self employed - have done the following steps
-rang local authority to see if it's okay for me to treat clients I might gather independantly at home (it's fine).
-registered as self-employed online (done and waiting on them to get back to me). i guess that will then get the ball rolling with NI, tax, etc....

does everyone register for VAT, I know it's good if you do as you can claim back - however the thing that confuses me is do I add VAT on top of my prices hence making the client pay more so that I can hand over the VAT to hmrc??

Also any other advice in what else I might need to do would be great?

Many thanks.

Yve x

 

[kimi1101]

You don't have to register as VAT registered until your turnover is over £68,000, which rounds down to around £1300 a week. You can voluntarily register, but I don't think it is advisable.

Basically, if you were VAT registered, and bought something that was £117.50...you could claim the £17.50 back, as that would be the VAT that was added to that product. Sounds great, yeah?

But you then need to give the taxman 17.5% on everything you do in the salon. So if your takings are higher than your outgoings (lets hope they are!!) You will be paying VAT more than claiming back.

Hope this is simple to understand?

 

[yve93]

deffo won't be registering for VAT, you've definitely simplified it for me, thanks hun x

 

[kimi1101]

Nah, I'm sitting very near the threshold and it sucks. Someone on here said if you get to that point, you need to work your butt off to get up to around £90,000 before you are back to normal again. It is good to be able to claim back but unless you are spending more than you are making (which is stupid cos then youd not have any money) your gonna be paying mr tax man more money. on top of your usual tax bill. xx

 

[yve93]

i used to live in the middle east for a few years, tax free money...that was NICE x

 

[kimi1101]

Ugh...no fair!!! I have a nice wee savings account for my tax and I wish I couldn't see what is in it cos I keep thinking what I could buy with it if I didn't have to pay tax...lol anyway whats the point moaning about it!!!!