Self-employment

Self-employment is the simplest and easiest way to start a new business. You can keep straightforward records, report the profit on your tax return and pay tax and national insurance on the taxable profit. We can set you up with easy to use software to keep your records and raise invoices, all on your mobile phone if you prefer, and then produce your accounts and tax return for you. All for a simple monthly fee. In addition we will ensure you claim all allowable expenses to legitimately minimise your tax liability (which reduces your accounting cost to start self employment!).

Should I Register As Self-Employed Or Set Up A Limited Company?

We are asked almost daily whether it would be best to be a sole trader (it means the same as self-employed) or start a limited company. There are several issues you need to understand before coming to a decision about what works best for you.

Tax And Self Employment

For the self-employed all profits are taxable in the year they are earned, in addition to any other sources of income, for simple tax returns. There is no flexibility for deferring some of those profits to another year if you happen to have a particularly good year and your annual tax return is at the higher rate.

Can I Change From Self Employment To A Limited Company?

Yes, you can start as self-employed and later incorporate. In fact, this is a common route when a new business is unsure of how large it will grow and whether the savings will outweigh the costs. If you make an initial loss being a sole trader you may be able to offset the loss against employment income in the same or previous years and obtain a tax rebate.

Much of this will depend on your particular circumstances so you will need to consult a professional tax return accountant near you to ensure that any set up and transition is done properly.