Starting work before registering as self-employed
Thread poster: clairemcn
clairemcn
United Kingdom
Local time: 17:53
Member (2013)
French to English
+ ...
Jan 2, 2013

Hi everyone and happy new year!

I really want to get into translation properly in 2013 and set myself up as a freelancer. I'm currently living in Spain and registering as self-employed here is very difficult , especially considering that I'm planning to leave in June. My current plan is to move back to the UK in the summer and register as self-employed there. I don't think it's possible to register now while I'm in PAYE employment in Spain and paying Spanish tax. The issue is that I have a lot of free time at the moment and this would be an ideal time to get started.

I'd like to know if it's possible to register as self-employed AFTER starting freelance work (and therefore invoicing clients)? Has anyone done it? It would be great to start now while I have the free time and sort out all the paperwork when I'm back in the UK, but I don't want things to get messy.

Any advice greatly appreciated.


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Russell Jones  Identity Verified
United Kingdom
Local time: 17:53
Italian to English
Previous Threads Jan 2, 2013

Hi Claire

There was a recent thread on exactly this subject, here: http://www.proz.com/topic/239191

Other relevant threads are: http://www.proz.com/topic/200215
and
http://www.proz.com/topic/157307


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clairemcn
United Kingdom
Local time: 17:53
Member (2013)
French to English
+ ...
TOPIC STARTER
Tax and NI Jan 2, 2013

Hi Russell,

Thanks for the links. I'd already read those threads but I'm still a bit confused. I'm a British citizen with a NI number and have lived and worked in the UK before, so things should hopefully go a little more smoothly than they did for some of the other posters.

I gather that you have 6 months after the end of the current tax year to register as self-employed (which is October 2013 unless I've misunderstood, so no problem there as I'd be back in the UK) but you need to register for NI 3 months after the end of the month in which you start working as a freelancer. If I started freelancing right now, that would mean I'd have to register for NI in April, still resident in Spain. Is it OK to do that? My permanent address is in the UK, but I'm officially tax resident here as I'm living here for 9 months and paying tax through Spanish PAYE. I know next to nothing about NI but have heard it's perfectly fine to make contributions while living abroad - does this apply in my case?


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Clive Phillips  Identity Verified
United Kingdom
Local time: 17:53
Member (2009)
German to English
+ ...
HMRC were fairly laid-back in my case Jan 2, 2013

Hello Claire,

I don't think one needs to be overly concerned about meeting deadlines in registering as self-employed. I was rather tardy and had been invoicing and receiving (albeit a fairly small) income for some months before registering. There were no negative consequences.

In my experience, as long as you pay any due tax and any missed NI contributions, e.g. as a lump sum, HMRC do not seem to be too fussed. They also run local classes for the newly self-employed (after you've moved to UK). Make sure you're paying the correct Class(es) of NI contribs - determined by your estimated level of income. The HMRC website gives the detail.

I don't know whether you can pay NI contribs while living abroad but I can't think why not.


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Russell Jones  Identity Verified
United Kingdom
Local time: 17:53
Italian to English
Ask by telephone Jan 2, 2013

I personally found HMRC helpful on the phone on this issue (unlike the nightmare of trying to speak to someone about tax issues).

Others have said the same on this site.


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clairemcn
United Kingdom
Local time: 17:53
Member (2013)
French to English
+ ...
TOPIC STARTER
Tax things Jan 3, 2013

I bit the bullet and phoned HMRC and they told me I am in fact still resident in the UK for tax purposes, which is what I wanted to hear. I didn't think I'd spent enough time there this tax year, but I'm not tax resident in Spain either, as their tax year is the calendar year and I spent only 3 months here in Spain last year and will spend under 6 months here this year. Should I ask HMRC to confirm that in writing or let sleeping dogs lie? Surely I have to be tax resident somewhere, anyway?

I've had a look on the HMRC website - it's 'register your new business' I need, isn't it? Or is it this? https://online.hmrc.gov.uk/shortforms/form/CWF1ST?dept-name=CWF1&sub-dept-name=&location=40&origin=http://www.hmrc.gov.uk Or both?


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