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Original poster

Declaring extra income or not?

66 replies

Gene9 · 14/12/2016 23:57

Probably a poor choice of title, sorry. Have posted here for trafficking as I'm worried about getting into legal troubles!

Hi, I've been a PA all my working life really. Left my job for personal reasons about 5 months ago.

Just landed a new role, lovely position as a PA, really happy. Not self employed.

Thing is, I've landed myself a very nice little money earner online... I signed up two weeks ago for fun and so far I've brought in a lot

I'm scared - I know I need to declare this as two incomes so how do I go about doing this? I'm clueless

The online thing is very dependant on me, if I didn't use it that week I'd get £0. What I actually get from doing it can vary differently, apparently.

With all this in mind, how do I tell (whoever I need to tell), about my earning amount since it can be anything from £0 up.

Thank you

OP posts:
MrsHathaway · 14/12/2016 23:59

I think you just do a tax return at the end of the tax year. How are you paid by the online thing?

DH has a salaried job (PAYE) and some freelance on the side. He does a tax return and pays the additional by cheque. There are tax efficient ways to do this if there's a lot, btw, which might include starting a limited company.

Original poster
Gene9 · 15/12/2016 00:01

Mrs Would some sort of person send me a letter saying how much it is?

Also is it just one lump of amount that needs to be sent off as a tax return?

Money is paid into HSBC by both sources of income

OP posts:
TheProblemOfSusan · 15/12/2016 00:03

Sounds like you've not been doing it long? If so I'm sure that a call to HMRC will tell you what you need to know - that's the sort of thing I put off and get really anxious about but then turns out to be fine and dandy once I've done it.

Just out of interest, TOTALLY asking for a friend, etc etc, what online thing is this? I would quite like to not rent for the rest of my life so money earners are very welcome chez moi.

MrsHathaway · 15/12/2016 00:05

When DH does his tax return online the calculator tells you how much to pay. It's really very simple.

It sounds a bit dodgy though. And your post sounds a bit like you're angling for us to ask, so you can sign us up for some scam. Is that what you intended?

PenguinsandPebbles · 15/12/2016 00:06

What does PA, mean in your context?

lalalalyra · 15/12/2016 00:06

You'll have to register as self employed for your online job. HMRC have a lot of webinar type things to explain how to do it and what you need to do. You'll have to fill in your income and the likes in your tax return for them to know how much you have to pay.

Original poster
Gene9 · 15/12/2016 00:07

No way do I want to sign anyone up for a scam! Hence me not giving away what it is I do - but I can tell you it's 100% legal and all very fine, it's just you have to declare your earnings from it.

Will look at tax return calculator

OP posts:
Original poster
Gene9 · 15/12/2016 00:08

Penguins a PA is a personal Assistant in my dialect

Also how can I tell them my income (added on with 2nd job obviously) if it can vary from just my normal salary, a bit extra or double/triple what I earn as a PA?

OP posts:
PenguinsandPebbles · 15/12/2016 00:12

Sorry just clarifying

Approach HMRC, tell them details

They will advise you, you will pay tax on these earnings

You will be asked to complete a form the following year, they will adjust your tax code for the following year

MrsHathaway · 15/12/2016 00:13

Sorry, but you see what I was getting at.

You do the return at the end of the financial year (eg by September 2017 for the year April 2016 - April 2017). It means you need to keep an eye on how much tax you would have paid. You could use eg this website each month to work out what you would have paid in tax that month (put in your actual earnings and tax code), then make damn sure you hide the tax money from yourself, plus a bit just in case you did the sums wrong.

PenguinsandPebbles · 15/12/2016 00:15

If it's a "gift" for services then don't declare it

For example: I make a cake for someone they give me £1,000 for it. That's not paying for my services

PenguinsandPebbles · 15/12/2016 00:16

It's a gift to me for doing something for them

MrsHathaway · 15/12/2016 00:19

???

I'm not at all sure HMRC would see it that way. There are limits (for example) on the size of gifts that can be given between spouses/parents and children before tax is payable.

Original poster
Gene9 · 15/12/2016 00:22

MrsHath The hiding extra money from myself is a good idea! Just in case my calculations get muddled

Interesting on the gift argument though... but since it's paid to me by a company directly, I don't think it's a gift

OP posts:
JungleInTheRumble · 15/12/2016 00:22

Penguins that doesn't sound right. You need to pay tax on earnings if you're carrying on a "trade". There are a lot of different tests to determine whether you're trading or not - whether the person paying for the goods and services calls the payment a gift or not is not one of them!

baconandeggies · 15/12/2016 00:23

It's a freelance role so you have a legal duty to register with HMRC as self-employed so you can submit annual tax returns. It's super easy.

Alabastard · 15/12/2016 00:24

penguins that's not a gift. That's a tax dodge.

baconandeggies · 15/12/2016 00:24

Interesting interpretation if the law Penguins Hmm

PrinceHansOfTheTescoAisles · 15/12/2016 00:29

Wtas ! I used to freelance, now employed but still have some freelance hangovers plus blog earnings. ...so I do a self assessment around now ish every year for the tax year before. Or rather I get my accountant husband to do it for me ;)

Justaboy · 15/12/2016 00:32

Well let us know the secret of your online bizz then:)

Might not be a bad idea to get a bit of advice from an accountant as to what you can set off against trading profits and all that.

Not many people are that clued up on such matters

IamNotDarling · 15/12/2016 00:33

*If it's a "gift" for services then don't declare it

For example: I make a cake for someone they give me £1,000 for it. That's not paying for my services*

^ Bollocks, don't take tax advice from this person. They haven't a clue. A gift for services rendered with a view to making profit would be taxable.

If you were gifted £500 by someone because of your job, e.g a tip and you're an employee - whilst it's lovely, it's usually taxable because it's derived from your employment. Tip and self employee? Taxable.

If you set out to make money from spending your time doing something then you pretty certain it's taxable as income (except where it's gambling).

Contact HMRC, notify your additional source of income and register for self assessment. If you started this year then your first tax return is to 5 April 17 and has to be filed by the end of September 17. You will know your income by then!

Even sex workers register - 'personal services' is usually the description offered.

BadKnee · 15/12/2016 00:34

I think maybe Penguins was trying to show the difference between something you do as a business, (like the OP does) , as a one off.

If I give a colleague a lift and she gives me flowers - it is a gift. If I take her to work every week and she offers me some cash as a "contribution" it doesn't count as income. Same with the cake If I make a cake for a friend and she pays me - that's fine - but if I do it for anyone and charge money - it's a business.
And OP - Phone HMRC. Register for self assessment online. Then you complete your tax return at the end of the year. Put in what you have earnt from your job and your sideline. Pay the tax by bank transfer or card.

PenguinsandPebbles · 15/12/2016 00:36

I've paid 40% tax for years

I said if it's an income the OP should tell HRMC

Original poster
Gene9 · 15/12/2016 00:38

So my tax now roles into one whole chunk of non self employed earnings and self employed earnings? Instead of me paying two separate taxes if that makes sense?

OP posts:
PenguinsandPebbles · 15/12/2016 00:38

Thank you bad knee yes exactly that!

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