starting a small buisness??

[oli123]

hi all

strange question, and possibility of making me sound foolish

I currently work for a major organisation repairing cars and large vans.

all my own tools are at home as the company I work for supplies them, plus I have a full car / truck diagnostic setup on my computer.

my shift pattern allows me the possibility of earning a few quid servicing local peoples cars and doing diagnostic plug ins etc, only a few days a week, not full time.

what I want to know before I was to get any stamps / business cards made, is how do I go about registering something like this? I want to do things legitimately without getting in trouble really, the income would literally be hardly anything. just a bit of pocket money really, probably less than 1k per year most of the time.

do I have to register with the government for this??

can I create business cards etc before I was to register anything without getting in trouble??

ive never done anything like this before, so could do with some advice, have consulted google and had mixed opinions.

thanks

[VIP]

You won't need to VAT register for such a small turnover.

You will have to set yourself up with HMRC as a Sole Trader and do Self Assessment Income Tax returns however.

[allthingsauto]

HMRC are very helpful.I phoned them up a few years ago as I had a full time job but started buying and selling car parts etc online.They told me that I would need to register as a sole trader.Done that over the phone.Tax returns are not a problem.You can do them online or ask for a paper form (this is what I do).Just remember to keep all receipts and to keep 2 books for money in and out.You will be surprised what you can claim for.Things may have changed now as this was about 3 years ago now.

[deaddave72]

Everyone here has pretty much covered things. You will only need to be a sole trader on such a small turn over. I'm selfemployed and as its my sole income, i have to be honest in saying that its a chore rather than a pleasure. One thing i would say is that if you are servicing cars, the waste disposal thing will be a challenge from home. Also make sure that you don't need planning permission or if in a council house, that the council don't mind. The neighbors may also have something to say, so having a word with them might help, even if it is on the odd occasion.

All i did was ask the council, as i was in a council house at the time, got a business account sorted out at the bank and contacted the HMRC to let them know. 7 years down the line and I'm just keeping my head above water and despite a few life challenges, I'm still getting oily.

[Imperial]

Not sure about the business stuff but be careful in case you have a conflict of interest clause in your current contract, you could run into trouble doing this sort of work for yourself if it's similar to your current job. You may end up be self employed full time!

[gazzab1978]

from memery you have three months to register from the day you start trading, you can get any cards ect made up and advertise your services in advance too so wouldnt need to notify hmrc until three months after your first job so if you don't get any takers after producing cards ect you wont need to notify hmrc. once you do notify them you will have to do a self assesment each year declaring any earnings and will continue doing these for a number of years after you stop trading usually too if you ever give it up.

[gazz81]

If you have a long term intention of running your own business, do it!

I did a similar thing, albeit in double glazing. Started off supplying and fitting windows over weekends then took the plunge. Been on my own now for 3 years and I wouldn't look back.

As others have said, just register with Hmrc for your self assessment, but you will more than likely end up paying more tax than you wish!!

The obvious solution is to do some cash jobs, but unfortunately it is frowned upon by the tax man!

[dodgerover]

Understanding what you can claim as expenses is a critical part of being self employed and minimising your tax bill. Credit where it's due HMRC are really helpful if you have a query. If you don't want to do your own tax return you can pay an accountant to do it for you, just beware there are some shocking ones out there and if they do it wrongly it's you who will end up paying and not them....

[avengertec]

Liability insurance is worth a consideration

Road testing will also be a problem without trade insurance
But you could get around that by getting the customer to drive and you go with them to listen for noises etc but not ideal

[dan]

All good info above but being a sole trader you won't be able to claim back the 20% VAT on oil and parts which may niggle over time.

Working from home you'll be surprised at what you can run through the business (electricity, water, phone, IT, fuel, etc) as a tax deductible expense which effectively lowers your cost of living.

[gazz81]

May 4, 2016 20:54:52 GMT dan said:

All good info above but being a sole trader you won't be able to claim back the 20% VAT on oil and parts which may niggle over time.

Working from home you'll be surprised at what you can run through the business (electricity, water, phone, IT, fuel, etc) as a tax deductible expense which effectively lowers your cost of living.

I thought anyone could apply to be vat registered?

[dan]

A sole trader can become VAT registered at any point but if your turnover is over £83,000 (2016/17) then you must become VAT registered. At this point you are limited company.
I am a sole trader and looked at becoming VAT registered this tax year however the limited company tax dividend rules have been overhauled and it wasn't worth me making the change.

Sorry if this is all really boring. Have a picture of a flying XJS to compensate

[Clamity]

May 4, 2016 21:45:48 GMT dan said:

A sole trader can become VAT registered at any point but if your turnover is over £83,000 (2016/17) then you must become VAT registered. At this point you are limited company.
I am a sole trader and looked at becoming VAT registered this tax year however the limited company tax dividend rules have been overhauled and it wasn't worth me making the change.

Incorporating a limited company involves registering with a company address, director, issuing shares and shelling out some cash to Companies House for the privilege. It doesn't happen automatically, but it is easy to do. Winding it up again later on is much more of a pain IME.

It's probably worth registering for VAT if you have significant capital expenditure, new tools for example.

[oli123]

thanks for all the replies

very useful information indeed

gives me some food for thought for the near future.

[nomad]

^ lots of good advice above, I see 2 main ways to do things ...

properly.
advise you set up a new bank account just for business use.
keep all receipts, notes of mileage driven on jobs, etc.

suck-it-and-see -
try a few jobs and see if it's worth doing.

Either way, you can get business cards made up anytime you like.
Think about getting a cheap mobile with "throw-away" number if you don't want to give your personal number out to strangers.

[peewee]

May 4, 2016 19:16:57 GMT gazz81 said:

If you have a long term intention of running your own business, do it!

I did a similar thing, albeit in double glazing. Started off supplying and fitting windows over weekends then took the plunge. Been on my own now for 3 years and I wouldn't look back.

As others have said, just register with Hmrc for your self assessment, but you will more than likely end up paying more tax than you wish!!

The obvious solution is to do some cash jobs, but unfortunately it is frowned upon by the tax man!

whats your business name ? 

[gazz81]

May 13, 2016 17:21:27 GMT peewee said:

May 4, 2016 19:16:57 GMT gazz81 said:

If you have a long term intention of running your own business, do it!

I did a similar thing, albeit in double glazing. Started off supplying and fitting windows over weekends then took the plunge. Been on my own now for 3 years and I wouldn't look back.

As others have said, just register with Hmrc for your self assessment, but you will more than likely end up paying more tax than you wish!!

The obvious solution is to do some cash jobs, but unfortunately it is frowned upon by the tax man!

whats your business name ? 

Clearview Glazing

[peewee]

May 13, 2016 17:35:18 GMT gazz81 said:

May 13, 2016 17:21:27 GMT peewee said:

whats your business name ? 

Clearview Glazing

not someone i deliver too as i deliver glass for a window manuactuers most likely seen your van around down in bournemouth poole area on fridays