Freelance Translation Tax
Thread poster: babylona

babylona
Local time: 22:51
Spanish to English
Mar 24, 2014

Hi All,

I am nearing the end of my translation course and would like to start looking for paid work as a freelance translator.

I currenty work full-time in another job but would ideally like to use the translation work to supplement my income.

I do not expect to be earning thousands of pounds as I know the threshold is something like 7K before you have to declare tax.

If I am just earning a bit of money here and there occassionally, do I still need to declare it?

Also, do I need to fill in forms before I get the work or after? I don't know how it works but surely it will interfere with the tax I already pay in my full-time job as the HMRC will need two different tax codes...

Any advice appreciated.

Many thanks


 

Charlotte Farrell  Identity Verified
United Kingdom
Local time: 22:51
Member (2013)
German to English
+ ...
Speak to HMRC Mar 24, 2014

Hi Babylona. HMRC are really helpful if you call them on the phone, and their website is also pretty good. You can fill in a tax return that takes into account income from a full-time job and tax already paid through PAYE as well as self-employed income. You absolutely have to declare any income earned through freelance work, especially since you already have a full-time job that will mean you earn above £7k per year (I assume). Even if you only earn £500 through freelance work in a year, you'll still have to declare it and pay tax on it.

You shouldn't have to do anything in advance of getting work as long as you register and declare for the tax years you did receive payment in. Either way, give HMRC a call as they'll be able to tell you exactly what you need to do.


 

Charlie Bavington  Identity Verified
Local time: 22:51
French to English
A few comments Mar 27, 2014



I do not expect to be earning thousands of pounds as I know the threshold is something like 7K before you have to declare tax.


You don't really "declare tax". You declare your income, whatever it may be. Her Majesty's Revenue and Customs decide your taxicon_smile.gif

The default threshold this year (ending very soon) is actually £9,440. Next year (2014-15) we get a whopping ten grand before the income tax kicks in (there's still NI, mind).


If I am just earning a bit of money here and there occassionally, do I still need to declare it?

Of course. Why on earth would you think you could earn money and not report it? tsk tskicon_smile.gif

Also, do I need to fill in forms before I get the work or after? I don't know how it works but surely it will interfere with the tax I already pay in my full-time job as the HMRC will need two different tax codes...

You only have one tax code and that indicates your tax threshold, so it changes every year. Mine is 944L this year, for example.

Assuming simple circumstances, and a desire to keep things simple, you need to register as self-employed within 3 months of first earning money as a freelancer. You should also register for self assessment on HMRC's website (maybe wait until after April).
Next financial year end, you will then need to fill in a section on your income from employment (your employer will provide the figures) and a section on income from self-employment (you'll need to provide the figures!).
HMRC will be delighted to calculate your tax liability for youicon_smile.gif

(Assuming you earn more than £10k from your employment, and you are on P.A.Y.E, then your employment will use up your whole income tax allowance and you can assume you are paying tax on every penny you earn from freelancing, 20% being the basic rate at the moment.)


 

RoisinDean
United Kingdom
Irish to English
+ ...
PAYE work and freelance Mar 27, 2014

That 10K before tax figure applies to your TOTAL earnings. If you earn money from freelancing, that gets added to anything earned from PAYE employment

 

Marissa Aguayo Gavilano  Identity Verified
United Kingdom
Member (2016)
English to Spanish
+ ...
Foreign income May 4, 2014

Hi guys, I'm trying to file my tax return for the period that just ended. Basically all of my clients were not from the UK. Does this apply as foreign income? How should I mark it? It's kind of confusing and the online system also tells me that if I'm going to file foreign income I can't do it online :S

I'm sure you know about this because as freelancer we get clients from all around the world and not just our home country.

I will appreciate your help.

Marissa


 

Charlie Bavington  Identity Verified
Local time: 22:51
French to English
No May 5, 2014

xahntra wrote:

Hi guys, I'm trying to file my tax return for the period that just ended. Basically all of my clients were not from the UK. Does this apply as foreign income? How should I mark it?


No, it's not foreign income. It's just income from self-employment (I assume you are self employed), which is a business based in the UK, so that is the key factor. It just happens to have been paid in foreign currency (and indeed in my case paid into a foreign bank account) by foreign customers but the business that generated the money is here, so it just gets considered along with any other self-employment income.
You'll need to convert it into sterling, naturally (opens can of worms and runs away!).

(If you read the details about what counts as foreign income, you see that "earnings from foreign countries by a UK-based business" (as it were) is not actually one of the types of income hmrc want to see in the "foreign income" section.)


 


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