to wonder how many Facebook 'businesses' aren't registered with HMRC?

[Mimstar]

Two that I know of, one who boasts about being a business woman - are completely open about the fact that they aren't registered as they 'wouldn't earn enough to pay tax anyway'. That's how it works - is it? National Insurance, for a start.

I am a self employed marketing consultant and copywriter - and it really riles me to see these people setting up a Facebook page (selling dummy clips or 'candy'), painting themselves as the new Alan Sugar and then not declaring it!

I am not sure why it riles me so much to be honest, maybe I feel as though it makes a mockery of genuinely self employed people? Maybe it feels like they are taking the piss! During my first year of being self employed, I didn't earn enough to pay tax but I still declared it and paid my NI!

I was amazed how easy it was to get my tax etc position all legal.

I do get faintly riled when I see yet another new start-up in our business (dogwalking and petcare), but after 10 years, I know that after a couple of months, the bright spark who thought she/he could earn a few extra quid from a bit of dogwalking will realise it's not money for old rope after all. Usually they fizzle out - or end up working for me!

M0nkey, in my case I WILL be deliberately setting out to make a loss every year. It's my hobby and I am happy to spend money on it in the same way as people pay subs to play sport. I'll be selling things because I like making them and want to recoup some of the money I spend on materials. But if I do start selling I'll speak to hmrc and fill out a self assessment every year if I need to.

I wonder if the majority of them don't register etc because they are on benefits and it would cause a lot of hassle re handing the info over on a weekly basis for the sake of a few pounds here or there. Its one of the things that's put me off trying to sell some things I make (for my hobby) because I wouldn't know where to start with all that.

JollyHappyGiant I'm not an accountant so don't take my word for anything, but I think the registration rules were changed a couple of years ago so that you now only need to register for Self Assessment when you start making a profit. Link here.

Please do call HMRC and check with them though, as I could be wrong! But in your case of it really just being a hobby thing with no commercial intentions, you may not need to do self assessments.

I feel quite scared at the prospect of contacting HMRC tbh...

I think it's the thought that they could trawl through my accounts and accuse me of wrongdoing... although, as I said, I do very limited SE work and actually only just break even after I have paid expenses.

And I am fearful of the paperwork. And as someone else mentioned, the having to keep track of informing tax credits...

It all sounds so complicated... My main income is PAYE so I don't deal with tax assessments, tax is worked out by payroll for the company I work for.

Can someone please reassure me that HMRC are helpful and will not give me reams of complicated accounting to do.

I know I sound quite pathetic but I will ring HMRC on Monday and register myself if I feel I won't be buying myself a whole lot of trouble for myself.

But I accept that if I don't register myself I might be also buying trouble for myself in the future...

Nut I registered about 4yrs ago and I have found HMRC to be nothing but helpful getting hold of them by phone being the exception have a look online as to where the local HMRC drop in centre is. A lot of them are really nice :)

I do my own accounts and really it isn't all that complicated, it just takes a bit of getting used to if you haven't done it before. My losses in the first couple of years were carried forward and offset against my profit in the next years. It's relatively easy to set up a second bank account to save towards a tax bill and nowadays you can pay tax in advance of a bill so it isn't a huge amount you have to find in one go.

I know lots of people who are 'doing the double' working and getting benefits, it irks me a little but it's their look out if they get caught and I don't waste my time worrying about them. The same goes for insurance, I have mine paid up so I know I'm covered. Some venues only allow those with insurance to use their space so it does give me a bit of an advantage over any competitors, anyone who uses their services or runs events without insurance is making a rod for their own back if caught or worse if an accident happens.

The vast majority of s/e people I know are registered and paying their dues, or not, depending on their income. The paperwork I estimate takes about 1 day solid, once a year, for a small turnover so I don't think that's much of an excuse not to do it. If you don't make enough over your allowance you don't pay tax, so is one day a year really that much of a hinderance to registering? Not imo.

personal allowances you can make just over £10k before you pay tax - that's a huge amount for most small businesses so fear of having to pay out tax on very small profits is unfounded.

I train people in my work & I can't offer financial advice without paying more in insurance but I do point them in the direction of HMRC advice centres. Even if you are in employment and have a sideline s/e income the forms are so easy to fill in and at the very minimum Belfast HMRC centre is incredibly friendly discussions about motorbikes & roadkill included & accommodating about helping - maybe people in other areas could post up about their local centres as to levels of help?

Thanks SacreBlue

Right-O then, enough procrastination, I will contact the hopefully friendly HMRC tomorrow.

I agree, if it's roughly only a day of relatively simple paperwork once a year it is definitely worth doing.

You're welcome :) I think most stories about horrible experiences are more widely known just because we don't tend to talk about things that went well. I have had so many lovely experiences with places that get mostly bad reviews I feel it only fair to share the good experiences.

Good thing to do is to work out a system - like a file with poly pockets to stick receipts in every month - this makes end of year accounts a doddle. I usually hate the thought of doing the final accounts but get into 'the zone' once I start & then before I know it, it's done.

Another couple of tips if you get tax credits is to do your accounts at Easter then you have the figures for tax credits in July & all you have to do in October (by post) or my preference Jan (online) is to stick in the figures you have already done.

nutcracker years ago I was in the position of being scared to contact HMRC but knew I had to. Once I'd done it it was nothing like as bad as I thought it would be.