Welcome to the help portal for self employment, please choose from the topics below for help.
If you have an area which isn't covered below please contact us here.

➤ What is self employment?
➤ Registering for self employment
➤ Tax and self employment
➤ NI and self employment
➤ Records Keeping and Accounts
➤ Online Filing of accounts
➤ Finding an accountant
➤ Useful help and links

What is self employment?

Self-employment is the act of generating one's income directly from customers through working, clients or other organizations as opposed to being an employee of a business (or person).

Generally, HMRC will view a person as self-employed if the person chooses to be recognized as such, or is generating income such that the person is required to file a tax return.

Self-employed people generally earn income from a trade or business that they operate (Your's being your Betterware Business).

More Information ➤

Registering for self employment

To be self employed you need to tell HMRC you want to be a sole trader by registering. This can easily be done by registering online via the .GOV website, when registering online you'll also register for Self Assessment tax returns / Class 2 National Insurance at the same time.

Once registered you'll then be able to report your self-employment income through a tax return at the end of each tax year.

More Information ➤

Tax and self employment

If you're self-employed, you are responsible for declaring and paying income tax on the profits from your business. Self-employed people pay income tax on their profits, rather than their gross income. To work out the correct figure, you need to deduct business expenses from your business income.

You can also claim capital allowances and deduct any losses carried over from previous years. The resulting amount is your taxable income.

More Information ➤

NI and self employment

When self employed and working for yourself you are responsible for paying tax and National Insurance on your income. You usually pay 2 types of NI if you’re self-employed:

- Class 2 if your profits are £5,965 or more a year.
- Class 4 if your profits are £8,060 or more a year.

You can work out your profits by deducting your expenses from your self-employed income to come out with a total profit for your business. Class 2 is charge at £2.80 a week and Class 4 9% on profits between £8,060 and £42,385.

More Information ➤

Records Keeping and Accounts

You must keep records about your company itself and financial / accounting record for all money received and spent. You can hire a professional (eg an accountant) to help with your tax if you wish. HMRC may check your records to make sure you’re paying the right amount of tax.

You must keep accounting records that include:
- all money received and spent by the company
- details of assets owned by the company
- debts the company owes or is owed
- the stocktakings you used to work out the stock figure
- all goods bought and sold

More Information ➤

Online Filing of accounts

You will need to File a Company Tax Return online using HM Revenue and Customs’ (HMRC’s) online service. To login in you will need to use your Government Gateway user ID and password and a 0-digit Unique Taxpayers Reference.

If you don’t have a Government Gateway ID, you can register for an HMRC online account. You’ll need your 10-digit Unique Taxpayers Reference (UTR) - you get this in a letter after you’ve registered your company.

More Information ➤

Finding an accountant

Some self-employed people prefer having an accoutnant to take care of their accounts to help them with PAYE, VAT, personal tax, business tax, year-end accounts and returns.

Not everyone's good with figures, while trying to do it yourself could in fact prove much costlier than paying an accountant to do it for you. From a tax perspective, the business is also properly administered, which gives piece of mind and frees up the owner to do other things. To use a medical analogy, what you should be looking for is a good 'GP', with links to a 'specialist' if you need one.

More Information ➤