Consultancy Work Question

[JamesUK]

Hi,

I've been asked to carry out some paid consultancy work for a family business (I am related to the business owner). The business is not performing too well and they have asked for me to have a look at a few different parts of the business to see where things are going wrong. I want to do things properly so need to be sure of a few things.

If I carry out the work and then issue them with one itemised invoice, will I need to register for VAT, business rates etc? I can't see the total invoiced work coming to over £1,500, but does this matter? Also, this is a one-off thing and I will not be issuing more than one invoice.

I work part-time (earn over the personal allowance) and am a full-time university student.

Any info and advice will be greatly appreciated!

 

[mke]

You do not need to register for VAT unless your turnover - turnover, that is, not profit - will exceed more than a quarter of the annual threshold in a full quarter. You are nowhere near it on what you have said.

You do need to declare the additional income for income tax and national insurance purposes.

For something more precise, speak to your local tax office. You are not earning enough to warrant the expenditure of an accountant's fees (useful to get "friendly advice" if you know one though). HMRC are customer friendly and very helpful these days.

 

[Rufford]

Hi,

I've been asked to carry out some paid consultancy work for a family business (I am related to the business owner). The business is not performing too well and they have asked for me to have a look at a few different parts of the business to see where things are going wrong. I want to do things properly so need to be sure of a few things.

If I carry out the work and then issue them with one itemised invoice, will I need to register for VAT, business rates etc? I can't see the total invoiced work coming to over £1,500, but does this matter? Also, this is a one-off thing and I will not be issuing more than one invoice.

I work part-time (earn over the personal allowance) and am a full-time university student.

Any info and advice will be greatly appreciated!

Crikey - are you going to be okay for the consultancy work. A friend of mine took some financial advice off a skint member a finished up skint.... :|

 

[ac1234]

You will have to register as self employed - you can do this easily by phoning up the HMRC - number is on their website.

For work this size you do not need to get VAT registered or register for business rates.

Keep a copy of your invoice and any expenses (travel, stationery etc) as you will need to file a self-assessment form at the end of the financial year. Make sure you keep a bit of money aside for tax as well!

 

[JamesUK]

Thanks for the replies.

Registering as self employed has been mentioned. As I work elsewhere, I assume this will affect this employment... Is it possible to stay as I am and register as self employed for this one piece of work, the de-register if you get what i mean?

 

[mke]

James, you are getting your knickers in an awful twist for one small piece of work in financial terms. Just do it and declare the income on your next tax return. If you get invited to do more and it becomes more of a business, then do the relevant paperwork.

 

[The_One77]

what course are you studying James?
Im also interested in consultancy

 

[JamesUK]

James, you are getting your knickers in an awful twist for one small piece of work in financial terms. Just do it and declare the income on your next tax return. If you get invited to do more and it becomes more of a business, then do the relevant paperwork.

As I have previously said, I am not currently self-employed and so don't handle my tax returns as my employer does it for me. Are you suggesting that I can submit an additional return for this consultancy work?

Knickers in a twist? Just wanted to do things legally and correctly!

 

[JamesUK]

what course are you studying James?
Im also interested in consultancy

Well I did my undergraduate degree in Interntional Business about 7 years ago, and have decided to go back and do a masters (Msc) in International Business which I start in September.

 

[mke]

Indeed, James, and I am in total approval of your propriety. The expression was satirical rather than in approbation and was certainly not derisive.

As I posted earlier, my suggestion is a phone call to your local HMRC office. They will tell you whether a tax return is necessary or whatever alternatives are available. As you have painted it, it is currently a one-off whether or not it leads to further assignments. My plea is that you do not over-complicate it for yourself.

 

[oldeagleeye]

James. As you going back to univeristy why not do a contra deal with this family friend. In return for your work for instance they could give you £30 quids worth of vouchers a week for a year and you can get these on everything from food to books. Paying for your mobile phone is another option. Don't forget all barter deals are free of tax and vat. Good idea to learn a bit about contra deals then - they may not be in your international business study course books but how do you think we get most of our oil. We supply the middle east with arms in return for it of course. Rob

*** You can teach practically anyone how to fly an aircraft but you can teach anyone how to become an entrepreneur. It's in the blood and unless you have spilt a drop or two during your business career you ain't really a fully paid up member of the club yet.