Are you self-employed?

Posted on 19th February 2024 by Streets -  General


Image to represent Are you self-employed?

Self-employed taxpayers should notify HMRC as soon as practicable when they begin working for themselves. HMRC must be officially notified by 5 October following the end of the tax year so that a self-assessment return can be issued on time and to avoid any unnecessary penalties.

HMRC’s guidance says that you are probably self-employed if you:

  • run your business for yourself and take responsibility for its success or failure;
  • have several customers at the same time;
  • can decide how, where and when you do your work;
  • can hire other people at your own expense to help you or to do the work for you;
  • provide the main items of equipment to do your work;
  • are responsible for finishing any unsatisfactory work in your own time;
  • charge an agreed fixed price for your work; or
  • sell goods or services to make a profit (including through websites or apps).

The newly self-employed should also register to pay National Insurance contributions (NICs) and monitor whether a VAT registration is required.

There is a £1,000 tax allowances for miscellaneous trading income that has been available to taxpayers since April 2017. This is known as the trading allowance.

The exemption from tax applies to taxpayers who have trading income of up to £1,000 from:

  • self-employment;
  • casual services, for example, babysitting or gardening; and
  • hiring personal equipment, for example, power tools.

Where this £1,000 allowance covers all the individual’s relevant income (before expenses) the income is tax-free and does not have to be declared to HMRC.


No Advice

The content produced and presented by Streets is for general guidance and informational purposes only. It should not be construed as legal, tax, investment, financial or other advice. Furthermore, it should not be considered a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset. The information provided by Streets is of a general nature and is not specific for any individual or entity. Appropriate and tailored advice or independent research should be obtained before making any such decisions. Streets does not accept any liability for any loss or damage which is incurred from you acting or not acting as a result of obtaining Streets' visual or audible content.

Information

The content used by Streets has been obtained from or is based on sources that we believe to be accurate and reliable. Although reasonable care has been taken in gathering the necessary information, we cannot guarantee the accuracy or completeness of any information we publish and we accept no liability for any errors or omissions in material. You should always seek specific advice prior to making any investment, legal or tax decisions.


Expert insight and news straight
to your inbox

Related Articles


HMRC continues to target till fraud

HMRC has, for many years, looked to target businesses that deliberately undertake electronic sales suppression (ESS). ESS happens where a business deliberately manipulates its electronic sales records in order to hide or reduce the value of


Accessing the HMRC mobile APP

HMRC’s free tax app is available to download from the App Store for iOS and from the Google Play Store for Android. The latest version of the app includes updated functionality.


Measures to support household budgets from 1 April

In a recent press release the government confirmed the following policies to support household incomes from 1 April 2024. The National Living Wage has officially risen from £10.42 an hour to £11.44. This marks a £1,800 annual boost to full-time workers’ pay packets. This means nobody over ...


You might also be interested in...