Self employed

[lis02]

Hi I was wondering how I go about being self employed, I really don’t know where to start. I currently do housekeeping for a company but would like to take some on myself and be self employed, gradually build up my own clients. It would be cash in hand so I’m not sure how that would work in terms of proof of earnings? It would be more for housing benefit and child tax credits that would ask for proof? I’m a single parent and currently get both of these things, also council tax reduction.

If anyone can help me I would really appreciate it

You register as a sole trader. Then you start trading.

Cash in hand or card payments are fine. Just always write a receipt, and ensure you keep very clean records of all your income.

When you fill our your tax credits renewal, you just put down your annual earnings. For the first time, it's better to do the renewal over the phone so you can explain that you were previously employed but have only been self employed for a few months, so your expected income for next year is different and they can use your expected figure (If your income starts to look like it will be more than the figure you give them, then call and update it. Any overpayments or underpayments will be sorted once the year is over).

You need to do a tax return every year. There are a couple of different ways to manage your books, I use cash basis but you really need to look that up, understand what your responaibilites are and keep good records.

Card readers are really easy to use, so you could carry a card reader and take payments that way. Customers may prefer that so they don't need to have cash on them.