Tax update: Self-employed set-up check list

Self-employed set-up check list

If you are considering dipping your toe in the water, setting up a part-time or full-time self-employed business, there are a series of chores you will need to complete to fulfil your legal obligations, and provide a solid foundation for your business.

The list that follows is not comprehensive; each business will have its own specific requirements, but this check list will at least help you deal with your obligations to your local tax office.

We assume that you have tackled the basics: you have researched your intended market, you have the necessary skills to deliver the services you anticipate supplying, you have sufficient capital to fund cash flow in the initial stages, and you have considered the commercial risks you are stepping into?

Dealing with the registration of your business with HMRC - here’s what you will need to do:

1. HMRC provides business taxpayers with an online account. To access this account, you will need to use the Government Gateway portal.
2. To notify HMRC that you have commenced in self-employment, you should complete form CWF1 if you cannot use the online service. This includes registration for income tax and national insurance.
3. If you expect your turnover to exceed the current VAT registration limit (currently £85,000), or if you will incur significant purchases of goods or services that include VAT before your turnover reaches the registration threshold, then you should consider registration for VAT with HMRC. It is possible to register before your turnover reaches the £85,000 threshold.
4. If you are going to employ another person you will need to register your business for PAYE. This will enable you to deduct the correct amount of tax and national insurance from your employees’ wages and pay this over to HMRC.
5. And finally, if you are intending to be a building contractor you must register with HMRC before making any payments to subcontractors.

As you can see, this is not a process for the faint hearted but these five points (if they apply) are the minimum you will need to work through to keep to the right side of HMRC and avoid fines associated with non-compliance.

We can help. By completing a simple authority form, 64-8, New Forest Tax Accountants can act on your behalf to ensure that all these formalities are dealt with on a timely basis, leaving you free to develop your new business.

We would also be delighted to comment on your business plans and see if we can use our experience of working with similar business start-ups, to contribute and see you safely on the road to success.

FREE CONSULTATION

For advice on any of these matters and to organise a free initial consultation, contact New Forest Tax Accountants on 01590 688838 or email This email address is being protected from spambots. You need JavaScript enabled to view it. . 

© New Forest Tax Accountants 2019

The information in this communication does not constitute individual advice. New Forest Tax Accountants will not accept any responsibility for decisions taken or not taken on the basis of the information presented here. Before taking any action, including no action, always obtain independent, professional advice relevant to your own circumstances – preferably in writing. Any reference to legislation and tax is only based on published legislation and standards at the time this communication was published.