Will I be self employed? What do I do?

[Pottytrainhelp]

I am going to start work for a family friend. Just occasional admin and telephone work. His previous assistant (another family friend) would invoice her hours to him each month so he told me to do the same. I have no problem with that but what do I do about tax and NI? Gov.uk is confusing as hell, as is the rest of Google

I used to do this on a self employed basis…it’s important to let the Inland Revenue know what you are doing (by completing a self employed self assessment form in November/December this year). Obviously, you are allowed to earn so much before paying Tax but I’m not sure if you are already employed? Is this in addition to paid employment? It is an income you do need to declare, even if it’s under the threshold where you need to pay Tax.

Hope this makes sense.

If your earning less than the threshold for tax which is around 12k per year you won't pay tax . If you earn more than that you will pay at end of tax year when you do a self assessment. You can reduce your tax bill with any expenses you have for running your business. Same with ni it's paid at end of tax year unless you don't earn enough money to pay ni. In that case you can make voluntary contributions to make sure you get your stamp.

If this is your only job then it’s not legit to do it as a self employed position. You technically need to be doing this (or indeed anything else) for several clients to be able to be SE.

You need to register as SE. Every year you need to fill in a self assessment and HMRC will tell you how much tax and NI you need to pay, so it’s worth putting a bit away each month to cover it.

You need to have a look on the HMRC website to check that what you are doing really meets the threshold for self-employment. It's not unknown for employers to try and get round paying tax and employer's NI by claiming someone is self-employed when in fact they are not.

If you are definitely self-employed, your rates need to reflect the fact that you don't get holiday, sick pay etc so if this would normally be a minimum wage job, you need to be charging a good 30% more than that (I'm not suggesting it is a MW job, just using that as an example).

From there, it's about keeping careful track, invoicing, registering for a self-assessment tax return, filling it in, paying your tax from there.

You are allowed to earn a small amount (I think it's around £1k but don't quote me on that) from self employment without registering as self employed, but even if you earn under your personal tax threshold you still need to do a tax return. And think about voluntary NI payments if you don't meet the threshold for them, to protect your pension contributions.

It's actually not complicated - aware it doesn't sound like that - but there is an element of self-management and hassle so you have to work out if it's all worth it for you.

Does not meet the requirements for self employment I'm afraid.

Sadly a lot of 'employers' think you can just be self employed.

You will be missing out on NI years too.

If this is your only job then it’s not legit to do it as a self employed position. You technically need to be doing this (or indeed anything else) for several clients to be able to be SE.

This is not true - OP I wouldn't get technical advice off here, or try posting in legal.

It will be my only job. I’ve had to leave my full time job due to childcare issues so this was to help me out and the friend. I would only be doing couple of hours in the evening

Look at the HMRC website and search “am I employed” or similar
There’s a series of questions to answer and it will tell you if you are SE
It’s not something you or the company can decide

You could register as a self employed virtual assistant. It would allow you to pick up other work as well. Register as a sole trader then you just need to submit a self assessment tax return once a year