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ChatterCastDesigns says

Hey everyone

I finished college a few weeks ago and instead of going to university, I plan on earning money and saving up. I’m currently 18 and have been looking at templates on themeforest for the last 2 years. I recently joined the website and was looking forward to selling some templates to start saving up some money, however I stumbled upon a thread about paying tax and now I’m starting to get confused about what I need to pay and where.

Some people are saying that you need to pay tax and others are saying you don’t. I haven’t registered for a business (because I don’t consider this to be a business but rather a hobby and hopefully something that earns me some money). Do I have to register somewhere to pay tax? Do I have to pay tax at all? Can anyone put me in the right direction?

I get the feeling someone is going to tell me to speak to an accountant, however I’m 18, unemployed and have only just left college so I haven’t got the money to pay for there advice (I’ve heard they can charge you a fortune for just sending you a letter).

Look forward to a good discussion

593 posts
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AlexFjord says

I am not 100% sure about how everyone does it but as a word of warning – something to consider is how you set up your commission payment for example Paypal BY LAW has to inform the inland revenue and/or authorities once you receive over a set amount (its something around the 5K mark) into your account.

You will be asked to state if the account is personal, service provider, business etc. With this in mind if you sell a lot of files then the potential fine if you do not declare earnings will be a lot more than the effort required to set yourself up self employed/ltd company etc.

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MSFX Moderator says

Wow, sorry but it’s quite naive to think you don’t have to pay any tax… if you’re not starting a Ltd company then you need to register with HMRC as a Soletrader – personally I would consider Ltd company in the long run since you’ll pay less tax but speak to an Accountant – ask around the family and friends, someone may know one who’ll do you a deal…

Accountants can be quite an expensive cost but boy do they save you some money and more importantly the time! Well worth the cost IMO and they’ll usually do a consultation session to start with for free (well mine did) so you can see if you both get along…

Personally I put 30% of everything that comes in aside for tax. This is always too much but it means at the end of the year I get some extra “surprise” savings :)

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frequencity says

Informative thread, helpful for a fellow Brit just starting out like myself :)

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StencilMedia says

Just to reinforce what everyone else is saying… yes, you do have to pay tax. Register as self employed and you can do your tax returns online.

You’ll have to pay National Insurance contributions as well. I wouldn’t bother with an accountant as the self assessment is all pretty straightforward as long as you keep accurate and detailed records of all your ins and outs. It’s up to you though. I just empty out a big box full of paperwork on the floor on January the 31st, crack open the scotch… and let the good times roll.

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MSFX Moderator says

Just to reinforce what everyone else is saying… yes, you do have to pay tax. Register as self employed and you can do your tax returns online. You’ll have to pay National Insurance contributions as well. I wouldn’t bother with an accountant as the self assessment is all pretty straightforward as long as you keep accurate and detailed records of all your ins and outs. It’s up to you though. I just empty out a big box full of paperwork on the floor on January the 31st, crack open the scotch… and let the good times roll.

you do it all in one go at the end of the year? Cripes. lol No wonder you need the scotch haha

21 posts
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cookiedough says

I just empty out a big box full of paperwork on the floor on January the 31st, crack open the scotch… and let the good times roll.

Drunk tax return filing a few hours before the deadline and the dreaded £100 fine!

Now there’s an Olympic sport if ever I heard one. Good show chap.

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BenSheppard says

Funny how this is quickly becoming a very British thread

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