Hi , am planning to go self employed at end of October but was wondering how i would go about paying my taxes. I know i would pay them on money i earn when i do my tax return at end of year but how would i pay them when i pay myself monthly?

Hoping someone here would know the answer :)

My hubby is SE and pays his tax twice a year...the end of jan and the end of july...the tax office sends him the amount he owes after his accountant has finished his bit. HTH.

I complete my tax return online any time after 6th April and then do a self assessment on their website. It tells me how much I owe (or they owe me!) and I do a secure transfer, either all at once or on 2 payments. :)

oh i see , so i don't have to pay a certain amount monthly then. thank you

How do i show what ive paid myself. Do i need payslips to show it - and if so , how?

OH is self employed and recommends having an accountant - however much or little you earn ;)   their fees are tax-deductable.     At the very least they'll save you hassle from the tax man by ensuring that all your forms are filled in correctly and your figures are correct.  They could also save you money, which is always a bonus :)

If you find yourself an accountant that works from his home...the charge is quite reasonable...you just keep all your invoices and receipts and keep records of everything and he will do the rest.

you dont really sound like you have enough knowledge on the requirements of S/Employment to  realistically become SE....why dont you go on  a basic course for SE book keeping or one that the local business groups organise, often free! Local small business and enterprise groups offer them all the time.
Dont forget NI has to be paid and you need to contact the local office to make arrangements for this.

>Dont forget NI has to be paid and you need to contact the local office to make arrangements for this.

The tax office sorts that out for you as soon as you register as being self-employed.

Definately get yourself a decent accountant - the few hundred you will pay in fees will be worth it. My OH is self employed and her accountant deals with everything including any questions to or from the tax office. He is extremely thorough and does a great job. Another self employed woman we know had a really dodgy accountant who thought he was doing her a favour by putting all sorts of expenses through, but the tax office caught on to this and she was faced with a few years of back tax to pay.

You will pay twice a year but you could do what we do and have a separate bank account set up to take a monthly amount - saves on the shock at the end of the year! We always put in a little extra 'just in case' and this gives us a good start on next years taxes.

>The tax office sorts that out for you as soon as you register as being self-employed<

In theory, yes, in my case it took 5 months of phone calls and letters to make them realise that I should be paying Self Employed NI contributions, as they didn't have me registered as self employed, then they informed me that as my SE profit was under the compulsory threshold for NI, I didn't need to pay it after all!! It then took nearly a year to get hold of an exemption certificate from them :-( Unfortunately, as in many large organisations, there are some super efficient staff, and some who seem to forget what they're supposed to do next as soon as they've put the phone down! :-)

HMRC run some quite useful free courses on how to keep accounts, fill in your SA form etc. I try to keep approx 30% of my profit to one side in a savings account to pay my tax bill at the end of each year, so I have the money there when it's due. I don't use an accountant, mainly because my accounts are very simple and I'm use to doing loads of complex form filling in my 'normal' employed job, so completing a SA form seems quite straightforward!! If you're not used to dealing with things like tax deductable expenses / capital purchase deductions etc, I would recommend an accountant though, if only to 'walk' you though your accounts for the first year.

Claire

If you are going into the Building game, you can join CIS scheme who will do all that at source then all you have to worry about is NI.

mine never did....I had to make my own enquirires and get it all sorted out myself.

When my son and I both registered as self-employed (about a year between us!) we simply handed in the registration form at the tax office and left it to them. After that we were both sent our NI bills every quarter and the tax return form every year.

maybe thats the new way of doing it. mine was over 20 years ago!

You probably have it there - this was in the last 3 years. :-)

hi , thanks for your replies again!

Am going to do domestic cleaning so accounts should be fairly simple. As long as i can understand the form then hopefully i should be ok without an accountant.I wont be hiring anyone else so don't need to worry about their wages. Think it should be just my wages , products and insurance i'll be paying out.

If you ring the general tax helpline, they will tell you what you can claim for.  Maybe your computer and internet to submit your tax return, part of your phone line rental to keep in touch with your clients, as well as your products....... etc :)

It is still worth while looking into the small business advisory help on basic book-keeping and accounting.  The tax return itself is a formidable form if you are not used to this sort of thing, and it is important to have basic accounts prepared before attempting to fill it in - at least a profit and loss account for your business.  You also need to know what you can and cannot offset against profit - your cleaning products, as you have said, but how about mileage/travelling, advertising, stationary?  Will you be buying any equipment (steam cleaners, commercial hoover etc) ?If so these need to be accounted for as capital purchases not consumables.  IT is also vital that you have a very clear paper trail in case tax office queries/does an inspection.  You need to understand about keeping and recording all invoices for purchases and also showing cash receipts - if your business is going to be largely cash payment, you need to make sure that you can clearly show all incomings and what you did with it.