Sorry this is all new to me and I want to make sure I’m not making any massive mistakes. I am a primary school teacher so never been self-employed or had to fill out a tax form or anything. Any tips would be massively appreciated.
In the uk, I believe there is any allowance before and tax needs to be declared and then after that I’d pay 20% (unless I was really successful and in the next tax bracket) on any profits? I believe I declare this once at the end of the tax year every year?
Is there anything else I need to be clued up on? I’m planning on launching a print on demand store selling to multiple countries.
Do I need to pay VAT?
Do I need to set myself up as a limited company?
Do I need insurance?
Are there any other hidden details I need to know regarding my outgoings?
Does it matter if my supplier is in the UK (same as me), the USA or China? Does it matter (tax-wise) if my customer is in a different country or is it just the international shipping costs I need to account for?
Again, I am simply running a print on demand store operating from a laptop in the UK. Just thought I’d ask now so I don’t get any nasty surprises in the future and it gives me plenty of time to research your replies.
This might be a bit late but thought I’d still answer some things. I don’t have an answer to everything unfortunately as I’m also new to this.
Anything I say is based on my understanding so please do your own research too.
1) in the UK, there’s a tax free allowance of around £1000 for which u don’t have to declare your income. That £1000 you earn, however, includes any income that comes your way. If you have a full time job you probably already earn above that. If you also start selling on shopify (means you are self employed), you need to register with HMRC as self employed, and complete a Self Assessment. Basically a tax return that will tell you based on all your sources of income, your day job and shopify, how much you’ve earned and what taxes you have to pay etc. If in one tax year, from all sources you earn less than around £12500 (I don’t remember the exact number), then you still have to register for self employment with HMRC. However, you won’t have to actually pay any income tax I think. If you go above that number, then 20% of anything above that gets taxed. Eg you earned £14,000. So, 14000-12500= £1,500 you’d only pay an income tax of 20% on that £1500.
You do not need to registed for VAT unless your business earns more than £85,000 in a year or so.
You don’t need to register as a limited company i think. You can just remain self employed as you are just starting out, and it’s just you in your house and a laptop, from what I gathered.