Starting a business

[BANNIGAN]

Hi,
I am looking to get a private hire taxi on the road and also offer airport runs. I am going to have 2 drivers drive for me and so will be keeping my day job. What I don't want to happen is my wages to be taken in to consideration with earnings from the taxi and shove me in to the high earners tax. Would starting my own business up get me round this. Any other suggestions would be grateful?

[xrayspecs]

You need to register a self employed. You can do this with one simple phone call to the inland revenue. Once you are registered (which you can be whilst also having a job and in the PAYE system. Open a separate bank account for your taxi earnings and next year when you fill in you self assesement form it will be an easy task to fill in (assuming you keep good and accurate acconts) Remember though that any earnings you make from your taxi business will be taxable at 25%, so open a second account as a tax account and when you pay money in, put 75% in your business account and 25% in your tax account. That way you will always have enough money to pay the tax man when it comes to your annual return.

You should then hope you have a poor trading year. This sounds daft, but in your second year of trading your tax bill is payable IN ADVANCE and it's based on the tax bill in your first year. If you do really well in your first year then not only will you have to pay your fiest years tax, but a similar amount in advance of your second year.