Registering as Self Employed

lmiddleham Registered Posts: 71 Regular contributor ⭐

A friend of mine wants to register as self employed soon.

They are aware that they have 3 months to do so from starting trading.
However, once they do register, do they have to declare their income and expenses from before that trading date?

They want me to help them with their record keeping so once they register, their records will be fine, but for any trading before that, I'm pretty sure they'll be non existent.

What's the best thing to do?



  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
    I'm not sure how you can have trading income before you start trading.

    Are you suggesting they put a date later than when they actually began trading and conveniently forget about their income prior?
  • lmiddleham
    lmiddleham Registered Posts: 71 Regular contributor ⭐
    No the issue is that theyve been self employed a couple of months but are only just about to register. Now they should declare that income too but i doubt theyll have any sort of records on that first 2 months income (receipts will be in cash)
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
    Start of trading should be when they "starting trading", then there would be no income before trading...or am I missing something here? Pre-trading expenses can be claimed, no problem.
  • JodieR
    JodieR Registered Posts: 1,002 Beyond epic contributor 🧙‍♂️
    If they haven't been keeping records up to now then you'll have to estimate the income so far as best you can. What method you use will depend on what business they're doing, but generally if you see their diary, bank statements etc and know what they charge per hour/day/item the you can piece something together.
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    Started trading December 2011.

    Register with HMRC February 2012.

    Start of trading to be declared as December 2011. As Jodie says, estimate income and expenses as best as possible if no records. There is a legal requirement to keep records.

    Note the 3 month rule is now obsolete and you should now register as soon as you start trading. The penalties for registering late are % based if any tax is paid late as a result of registering late. I don't see any penalties for your friend based on what you've said.
  • JamesB
    JamesB Registered Posts: 51 Epic contributor 🐘
    Hi Monsoon,

    How does the % work then? Ie if Joe Bloggs started trading on 6th april 2011, registered self emloyed (with effective trading date of 6th April 2011) on 1st Jan 2013 and then filed the tax return for 2011/12 on time and paid the tax due he will have no fine to pay?

    I'm not trying to be pedantic just curious.

    I thought I read somewhere a few weeks back that you have to
    Register before 31/10/xx of the tax year when you

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