How to Start and Register as a Freelance IT Contractor
If you are about to take the bold steps to start your own freelance work as an IT Contractor, or consultant, read the important information below.
Also, if you are employed and you are freelancing as your side hustle you will also find the information here very valuable….
Get Your Employer to Fund the First Steps
At the end of the current financial year, which ends on April 5, your employer will provide you with a form which is called the P60.
It will show a total of the pay and deductions that have been made to you throughout the year.
The company will deduct a part of your salary for taxes and according to what you earn you will pay more or less.
Now in the event that you believe that you have overpaid on taxes more than you should, you can take the document (P60) to the nearest Inland Revenue offices.
Check it out and then investigate if there is a tax refund for you, or not.
In the event that you are due a tax refund, you need to submit a self assessment tax return and a few weeks later they will send you a cheque. The amount can vary depending on your unique situation. For example, for some of our clients we reclaim £400 – £9,000.
Now, in case you work on your own already, you can also check with the Inland Revenue if you have overpaid tax in any previous years.
If you have a partner, or you are a couple, couples should file their tax refunds, or self assessments individually.
There are other forms that you will need depending on your situation:
– P46; When starting a new job you must fill out this form which will be sent to the Inland Revenue office so that your situation is regularized within the company or company. But it is probable that while that happens you have to pay what there is called emergency tax, which is a high percentage and that should be normalized as soon as possible.
– P45; This form is in the case that you have changed work or left an employer. This summarizes the taxes that you had to pay in your previous job and gives you the security that in the next job you do not have to pay the emergency tax. This form is also used when you need to request tax refunds.
– P38; If you are a student this is the form that you must fill out, the company will not pay taxes for you, in case of course you work part time and the time does not exceed 24 hours a week.
Get Expert Help
If you have little knowledge in respect to how to file the tax return, a good option would be to hire a tax adviser who can explain and help you to process the tax refund, or self assessment, to which you may be entitled.
The tax adviser will include helping you to fill in the form and correspond with the tax authorities (HMRC).
If you are completing a non-resident tax return, or expat tax return, then the requirements can include the following: If you intend to stay in the United Kingdom for less than three years and have work trips out of the country, or if work for a maximum of two years in a foreign company, or if profits or salaries are generated outside the country.
Do You Need to To Do a Tax Return?
Yes. The easiest way to complete your personal tax return is to do it online. However, you can also choose to get a form for the tax return, fill it out, and then mail your file, but you will need to make sure you have it completed by October 31 of the current tax year. If, on the other hand, you decide to do it online, you can do it until the end of January 31 at midnight.
How to Register as a Freelancer or Self Employed?
No matter which method you use, you will always have to register with HMRC (HM Revenue and Customs) to notify them that you need to file a tax return. This must be done before October 5 of the financial year after which you need to file your return. After the deadline, you will have to pay a fine.
You can register online, by mail or by phone. To make this registration, you will need your National Insurance number and your personal and business data.
Once you are registered, HMRC will send you your unique taxpayer reference number, which you will use to complete your self-assessment.
If you are not going to use the online method, you should get a Main Tax Return Form, also known as Form SA100. There is also a Short Tax Return Form, which is usually known as Form SA200, but this form can not be obtained by you. You get it only if the HMRC sends it and, in this case, you will not have to fill in the SA100, just the SA200. In addition, you may also need to fill in more sections, known as “Supplemental Pages.” This will depend on whether you have informed the HMRC about some other type of income such as:
• Employees or company directors (Form SA102)
• Self-employment (Form SA103S or SA103F)
• Commercial associations (Form SA104S or SA104F)
• Foreign income or earnings (Form SA106)
• Non-UK residents or dual residents (Form SA109), among others.
Where Can You Get The Tax Forms?
Step 1: All of these forms can be found and downloaded through the UK Government’s official website (gov.uk) in its Self-Assessment Tax Section (www.gov.uk/self-assessment-tax-returns).
Step 2: When you enter the Self Assessment tax returns page, you should look for the link that says “Register and submit your self-assessment tax return” and go to the page that Carries said link.
Step 3: Once there, look for the link: “Self Assessment Forms and Helpsheets”, which will take you to the page where you can download the SA100 Form, as well as any others you may need, Especially the Forms SA103S and SA103F, which are more attached to the status of self-employed IT contractors or consultants.
Step 4: You will note that by entering the “Self Assessment: Tax Return (SA100)” page, you can find and download a form (SA100) for the current fiscal year and the Last 3 years.
Step 5: You will also find here a small manual or guide that explains how to fill out the form. Both the form and the guide are downloaded as files in .PDF format and both are in English language. On this page you will also find links that will allow you to download any additional forms you may need.
Get It Done For You
We’re working with a number of self employed freelancers and directors of digital businesses to cut their tax bill in half in as little as 5 days and file the income tax return online. Our site already has over 31,000 awesome peeps like you who want good advice fast.
If you or your company does not keep tax records the right way, you could be charged a penalty of £3,000 or more.
Tax Twerk clients believe that this a big waste of money. This proactive service is helping them to keep their hard earned income in their bank accounts instead. It’s the result of a system: “operational efficiency”. We follow our pledge to you and complete the tax work in the shortest time possible.
Let’s Talk Tax
Questions? Need personal advice? For a free consultation call us on 0330 321 1136, or visit TaxTwerk.com today.