Self-employed freelance student job - should I be paying tax?

I have a work-from-home job as a tutor starting this tax year and although I am with a company, it is self-employed and 'freelance'. I choose the shifts myself which are on a first-come, first-serve basis but I have to do a minimum of 4 hours each week. Also, I'm a full-time student with my tuition paid for by SLC.

I definitely won't be earning over the week (£155) or monthly (£917) rates, am I still supposed to register as self-employed with HMRC or not do anything about it? I might earn over the threshold on the rare occasion when I have a lot of time to spare but it's very unlikely.

The HMRC hasn't been very helpful so far so if anyone's been in my situation, please help!

Hi there!

The simple answer to your question is - yes, you do need to register as self employed, and yes, you will need to submit a tax return. It doesn't matter if you think you'll be earning less than the tax threshold. Legally, you still need to submit a tax return, and you will then be told that you have £0 tax to pay (if you have earned under the threshold).

If your financial affairs are relatively simple, then submitting a tax return doesn't have to be difficult. You do not need an accountant - simply keep good records of your income and any allowable expenses, and you'll find it's all very doable.

For more information on the this and other aspects of tutoring, do take a look at the following page on our website:

http://www.thetutorpages.com/private-tutor-advice

Right, the only way I can keep track of the income is when the money goes into my bank account so do I need to send someone photocopies of my bank statement? Also, what do you mean by allowable expenses? Do I have to keep track of every single thing I spend money on?

You do not need to send any proof of funds received to anyone. HMRC will only need proof (ie bank statements etc) if they decide to audit you. Being audited is a very serious, but pretty unusual thing. Ultimately, as long as you are truthful about the amounts you are earning, you would have nothing to fear from an audit.

I would suggest setting up a simple Excel spreadsheet that looks something like this:

DATE | DESCRIPTION | AMOUNT
14.04.16 | Joe Bloggs tuition | £35

I'm afraid the formatting of this message board doesn't let me type the above very clearly, but you get the idea.

Fill it in as you go along, and then when you come to having to fill in your tax return, it will be a very simple job to calculate the total money you've earned in a year. The tax return only asks you for the sum total amount you've earned - you do NOT need to provide them with a breakdown. The spreadsheet is really just for you to keep track of it all, and to make things simple if you were ever audited. It almost seems too simple, I know, but that's really all you need in this kind of situation.

In terms of allowable expenses, it doesn't have to be complicated. You can go into great detail and start claiming for percentages of the cost of heating your home (if you're working from home) but a lot of people feel that's more trouble than it's worth. Generally, the kinds of expenses that you might want to offset against your income might be things like text books and other materials that are clearly only for your tutoring. Set up another part of your spreadsheet to keep a record of these things:

DATE | DESCRIPTION | AMOUNT
4.12.15 | Subscription to online Maths revision website | £35
10.02.16 | WHSmith Notebooks | £5.50
13.04.16 | OCR GCSE Maths textbook | £20

Again, HMRC will only ask you for a total £number when it's time to fill out your tax return. You do not need to show the breakdown, but you should keep any receipts (again, just in case you are ever audited).

There's also a lot more detail about all of this stuff in our free e-book, which you can download here:

http://www.thetutorpages.com/free-tutoring-ebook

What does it mean if you're audited and when would they decide to audit you?

I won't be buying anything at all for this tutoring job, everything is from memory and what I know plus it's online so nothing is needed in that sense. Do I still have to keep track of my expenses? In my mind, I'm thinking I'll have to keep the receipt of every single thing I buy including groceries and toiletries?

There is no predicting when one might be audited - it can happen because HMRC are suspicious about something, or entirely at random. HMRC would then require you to produce all relevant bank statements and your own records/receipts. You should not worry about being audited - as long as you keep even the simplest of records (as I describe above) and you are truthfully declaring all your income, you will have nothing to worry about. No one, of course, can say that you'll never be audited, but it is not a common thing.

Expenses are only relevant if they directly relate to your tutoring work - so, materials and subscriptions etc. If you have none, then you don't need to keep any records!

Please do take a look at the ebook linked to above - I think it will put your mind at rest with regards to these practical/legal issues.

on a side note, I am interested in becoming a tutor myself and would like to know how to go about it

I have downloaded it and it's very informative. Thank you for your help so far, you've put my mind a little at rest already



Are you at university?

im a grad (got masters in pharmacy at 21 yo)

What A-Level grades do you have? And are you looking for online tutoring or home?

A level grades are bad (in fairness I did have a lot of health issues during a2 which influenced it) but BCC (got 1st for the BPharm portion of degree, merit overall). 8A*-C grades as well for GCSEs (A level bio and gcse bio and chem; are what I am interested in (also clinical pharmacology at uni level for med, pharm, biomed etc students) - A level bio<<<healthcare degree in terms of knowledge)

You usually need to have an A grade in A-Level of the subject you wish to teach but since you have a degree, they might make an exception. Ask around, and apply to jobs. There's a website called MyTutorWeb which looks pretty good (not my one).

I need to find out tutoring agencies in my local area and how much they charge

You usually need to have an A grade in A-Level of the subject you wish to teach but since you have a degree, they might make an exception. Ask around, and apply to jobs. There's a website called MyTutorWeb which looks pretty good (not my one).

in terms of GCSEs, what are the requirements? ( lot of gcse high school teachers I know have C grades in subjects they teach)

Everyone I've come across has asked for A grade in A-Level in that subject but if you want to do it completely by yourself, with no agency, you could set it yourself I guess? Obviously you should be a good teacher to make up for not having the A in A-Level to gain parents' trusts.

I mean, to tutor for gcses not what gcses I need ( I should have clarified)

That is what I mean.