Earning a little extra money

[Hoodlumboodlum]

I'm looking to earn around £300 more a month to cover rises in cost of living. I have a qualification I could utilise for some online work. It's not tutoring but something similar (I don't want to be too outing).

I'm confident I could do the marketing, the admin and actual work but what I'm less sure of is the taxes, do I need to set up an official business? Insurance etc. can anyone advise as I want to ensure I do everything legally and properly. My 9-5 job is PAYE and always has been so this is new territory.

Thank you.

You just need to register for self assessment and do an annual tax return. It is very straight forward, they will know what you earn through PAYE. As I don’t t know your business it is hard for me to know if you need insurance. I don’t employ anyone but have professional indemnity insurance in case I balls up with the advice I give.

Thank you. Can you tell me a little bit about how the self assessment works especially if I also have PAYE work. Thank you.

https://www.gov.uk/register-for-self-assessment

that is the link OP, so I am self employed but I also do a return for my husband who is employed. You register through this link. Say you start your business this Nov 2025 then after the 5th April 2026 and before the end of Jan 2027 you need to submit a return to HMRC using the log in you get post registering. You will detail your income and any expenses - make sure you claim the work from home allowance, you can deduct any expenses you incur as a result of running your business. With only earning an extra 300 quid a month I would try and get used to doing the return yourself and not employ an accountant. HMRC will have your employed details and earning and then once the return is completed they will tell you what you owe. if you are only earning an extra 3600 a year you will do a one off payment by the 31st Jan each year. There are loads of online guidance on how to do it

So when I do husbands all his income from his paye work is already on HMRC. They know everything 🤣

That's really helpful. Thank you. So would you suggest holding a certain percentage back to pay the bill annually? 20%?

Depending on the tax bracket you’re already in, hold back more. I hold back 50%.

that’s pays the tax/ni/student loan etc.

Eeeek. I'm not sure it's worth it if it's maybe 50%. Potentially another PAYE job instead. Mind you, I don't have a student loan and I'm not in the highest tax bracket.

Op sorry I didn’t see your next question. If you are not in a high tax band I would hold back no more than say 22%. (You will have expenses you can deduct) i am higher rate payer now but when I started out I was not. Honestly if you kept back 20% in a high interest account you would be grand. I love to see people trying to side hustle and do better please feel free to message me in the future if you need any help 😊

That's so kind. Thank you.

I’m both employed and have a small business which I use self assessment for. It’s honestly quite straightforward especially if your self employed earnings are under £12k. I keep a separate bank account for the business and a tax account, I’m a higher tax payer so 50% of my self employed earnings are put aside for tax. I always have a sum left over from that because business expenses bring the tax burden down. The self assessment firm is really straightforward - just keep a record of your income (I have some people who pay in cash so I have those records on a spreadsheet) and receipts for your outgoings. The online form takes you through what you can deduct (business expenses, use of home, mileage costs if you’re driving to clients) and calculates your tax. Have a look at the form ahead of time so you have an idea of what’s involved.

If you’re instructing people (eg tutoring), giving advice, doing some kind of therapy or providing professional services you’ll need professional indemnity insurance. There are brokers who can advise what you’ll need for your particular line of work, and it doesn’t need to be expensive. My indemnity insurance is less than £100 a year.

Good luck, there’s a real sense of achievement in working for yourself however small the business might be.