Two different businesses as a sole trader?

[nitch]

Hello,

Just a quick question. I registered as a sole trader last year as I sell items on eBay. I only do it part-time to supplement my income from my full-time job.

Recently I've realised that I can also freelance some of my spare time out providing help to other small businesses with their marketing etc. As this service is completely different to my eBay business, I'd like to use a different name.

How does this work with the HMRC? I assume I just put everything through the books with my self-assessment but do I need to register another business?

Many thanks

 

[crphillips]

When your a sole trader there is no business name......it's simply Company A trading as John Smith........if you want to follow another line of work just make up some letter heads that read Company B trading as John Smith.

Im a sole trader and use approx 5 different trading names for different services and products we offer. We're going limited this year though so things will have to change for us.

You'd just need to make sure your invoice number follow on.

 

[nitch]

Excellent, many thanks for your help

 

[JamieM]

When your a sole trader there is no business name......it's simply Company A trading as John Smith........if you want to follow another line of work just make up some letter heads that read Company B trading as John Smith.

Bit confusing there...... it would be more like:

John Smith trading as Business Name A

John Smith trading as Business Name B

And yeah self assessment for John Smith.

 

[crphillips]

Bit confusing there...... it would be more like:

John Smith trading as Business Name A

John Smith trading as Business Name B

And yeah self assessment for John Smith.

Yeah sorry about that. Thought it didn't read right!

What JamieM said basically

 

[MyAccountantOnline]

I assume I just put everything through the books with my self-assessment

Yes you do

..do I need to register another business?

No if you've already registered as a soletrader as you are the business you dont need to register again.

 

[Jim Beam]

How would this work in the accounts?
Would you produce seperate P&Ls for each trade? Or would you lump everyting together in one P&L? Perhaps seperating out the income from each trade?

e.g John Smith T/A Company A income £1,000
John Smith T/A Company B income £2,000

 

[LTK82]

There would certainly be nothing wrong in 'lumping the P&L' together for taxation purposes, as you, as an individual entity is being taxed on the total P/L.

However, I would suggest that good business practice would say do them separately, if only for yourself, so you can see where you make and where you lose money. It makes sense really.

 

[Scalloway]

If they are separate trades you should have a separate self employment page for each in your tax return.

 

[Bungle2000]

If they are separate trades you should have a separate self employment page for each in your tax return.

Is that to say that, if I am a Sole Trader and I provide a service of Web Design, but I also provide a Hand Bag making service, they would need to be declared on the Self Assessment as 2 seperate businesses?

Would I have to give them different business names on the Self Assessment? (Even though I am just trading under my own name?)

Also, presumeably, you would have to keep them seperate as you couldn't carry tax-reliefs from one business to the other (e.g. I have large expenses or capital allowances for the Web Design business, I couldn't use that as relief against the Hand Bag making business?

Thanks,
Bungle2000

 

[Scalloway]

You give a description of the business in the first box of the self assessment form. All your profit/loss from self employment is aggregated. If you are a sole trader there is no distinction between your separate businesses.

 

[Bungle2000]

You give a description of the business in the first box of the self assessment form. All your profit/loss from self employment is aggregated. If you are a sole trader there is no distinction between your separate businesses.

So are you saying that on the Online Self Assessment form in "How many self-employed businesses did you have?" I should just say that I have 1 business, and in the description put both the business descriptions?
Or should they be declared as 2 business and keep all the figures seperately?

I always assumed that if you were a Sole Trader but had 2 streams of revenue from 2 different trades they had to be declared seperately.
Least not because you can't use allowances from one business to be used for the other? Or am I missing something?

Many thanks,
Bungle2000

 

[Scalloway]

I didn't make myself clear. You must fill in 2 sets of self employment pages. On one set you give the description of the business as Web Design, on the other you put Hand Bag making service. Then you enter the income and expenses for each business on the relevant pages.

You are a sole trader, you and the business are the same thing. Your employment income, investment income and self employment income are all added to give your taxable income as an individual.

 

[Bungle2000]

I didn't make myself clear. You must fill in 2 sets of self employment pages. On one set you give the description of the business as Web Design, on the other you put Hand Bag making service. Then you enter the income and expenses for each business on the relevant pages.

You are a sole trader, you and the business are the same thing. Your employment income, investment income and self employment income are all added to give your taxable income as an individual.

Many thanks Scalloway!
I have a few more queries but I will post seperately rather than hijack this thread.