sole trader business account?? where and how

[smok]

hello I need little help
finally register my beekeeping activity with hrmc and get utc ,but now looking for help with new business bank account set up.
because its a labyrinth in the question (lloyds bank)
does its worth to open business account or simply annual account will enough, i don't get over 10k

 

[pargyle]

hello I need little help
finally register my beekeeping activity with hrmc and get utc ,but now looking for help with new business bank account set up.
because its a labyrinth in the question (lloyds bank)
does its worth to open business account or simply annual account will enough, i don't get over 10k

Do you have another income stream as well as beekeeping ? With the sort of level of £10k (is that sales or profit) it hardly seems worth having a separate 'business' account ..I would simply ask your bank to set up a No:2 account alongside your existing bank account ... try and keep your beekeeping transactions within the No. 2 account and run a simple P & L sytem to track your sales and expenditure. You declare whatever profit (income) generated from your beekeeping activity on a tax return each year (and pay the income tax on it).

At the level of beekeeping you are talking about it is still really at Hobbyist level and there appears little benefit to declaring yourself as as sole trader.

 

[smok]

thank you very much,that cleared my wondering,and make me sure what to do,really appreciate it

 

[Newbeeneil]

hello I need little help
finally register my beekeeping activity with hrmc and get utc ,but now looking for help with new business bank account set up.
because its a labyrinth in the question (lloyds bank)
does its worth to open business account or simply annual account will enough, i don't get over 10k

I run my beekeeping through a bank account, (Mettle) which allows me to keep everything separate from my personal stuff.(approx 30k t/o)
I also run a small handyman business which my accountant advised me to run on another separate account (Nationwide) (approx £3k t/o)
I certainly find it much easier done separately.

 

[JamezF]

I've had Starling recommended to me as a good bank for small businesses. We currently use Tide and I can't say I'm overwhelmed by them. I believe they're just a front-end for someone else's banking service, which has caused difficulties on occasion. For example it seems to be very hard to get Klarna to transfer money to them.

James

 

[Wilco]

I use Starling. It's free. Not perfect but ok/fine for my needs 95+% of the time.

 

[Richard]

I use Mettle, haven't used it long but not had problems. Sold some jars with my Sumup card reader and transfers from that have been no issue.

One plus for me is it comes with FreeAgent accounting software free as long as there is at least one transaction through the account per month.

 

[ics19]

At the level of beekeeping you are talking about it is still really at Hobbyist level and there appears little benefit to declaring yourself as as sole trader

yes, 10k turnover may have little impact on tax if that's the only income, but HMRC say otherwise about registering as a sole trader:
https://www.gov.uk/become-sole-trader/register-sole-trader

 

[polymath]

hello I need little help
finally register my beekeeping activity with hrmc and get utc ,but now looking for help with new business bank account set up.
because its a labyrinth in the question (lloyds bank)
does its worth to open business account or simply annual account will enough, i don't get over 10k

Sorry totally disagree with other post. There are plenty of free business banking accounts out there, suggest use Starling - do NOT use Revolut too many reasons to go into here. By keeping it totally separate it will make your life easier in the future. It will take you under 15 min to open an account with them you can also use Tide, Metro as options.

 

[polymath]

i wrote a series of article for Beecraft a while back, up to £1k gross income it is a side hustle, but no deductions allowed. Next is register as Self employed for beekeeping, works well if your other main business is also not self employed e.g. window cleaner etc. Third and most expensive option is ltd company, cost circa £500 for accountant each year, but greater tax benefits if things grow. You can move from self employed to ltd if the time comes.

 

[polymath]

As self employed you need to keep accounts - hence easier with totally separate bank account, less likely also to mistakenly send money from to it if with a different bank than personal stuff. You can make deductions for costs, mileage, jars etc. So you significantly reduce your profits, remember anything related to honey is deductible, i.e. attending or entering events, membership of divisions, training, insurance etc. All of this can be deducted and thus reduce profits, even your mobile phone if you collect swarms becomes tax deductible.

 

[polymath]

As for accepting card payments you can now get things like Tapeeno and others that will offer Pin on Glass/Softpos/Mpos so in effect your phone is the POS machine no need to have a separate reader and then any funds will be sent directly to whatever bank account you want.

 

[Sutty]

If you register as a sole trader can you use expenses from previous years eg equipment to set off against income?

 

[ics19]

If you register as a sole trader can you use expenses from previous years eg equipment to set off against income?

Here's a previous thread, nothing has changed AFAIK. Pretty sure it has the docs that @polymath mentions.

https://beekeepingforum.co.uk/threads/sole-trader-limited-company-or-what.49574/

Having filled filled in the SA a few times, I've carried forward a loss within the *same* business/trade, but this is limited (past 4 years?) YMMV. The phrase on a previous form was "You can carry your loss, or the amount of loss remaining unused, forward to set against future profits from the same business. The loss is deducted from your profits in that business in the first and each subsequent year until it is used up."
You would be highly recommended to talk to an accountant, it may well save you money and/or a fine

 

[Dodge]

@polymath

How does it work when you are already a full time employed person paying tax through Paye and higher taxpayer?

 

[polymath]

@polymath

How does it work when you are already a full time employed person paying tax through Paye and higher taxpayer?

Not an issue, you can register as a self employed person with HMRC if you are also PAYE. The challenge comes more if you have two self emmployed roles. Now the issue with PAYE and Self Employed is that you will need to do a self assessment form at the end of the year, especially if a higher rate tax payer, but key to this is 70% of your income you should be able to find a way of offsetting costs against it.

 

[polymath]

If you register as a sole trader can you use expenses from previous years eg equipment to set off against income?

Not a tax accountant best is to ask chat gtp but i think not only current year.

 

[polymath]

Here's a previous thread, nothing has changed AFAIK. Pretty sure it has the docs that @polymath mentions.

https://beekeepingforum.co.uk/threads/sole-trader-limited-company-or-what.49574/

Having filled filled in the SA a few times, I've carried forward a loss within the *same* business/trade, but this is limited (past 4 years?) YMMV. The phrase on a previous form was "You can carry your loss, or the amount of loss remaining unused, forward to set against future profits from the same business. The loss is deducted from your profits in that business in the first and each subsequent year until it is used up."
You would be highly recommended to talk to an accountant, it may well save you money and/or a fine

Losses as a ltd company yes can be carried forward as a sole trader not sure think not.

 

[Sutty]

Losses as a ltd company yes can be carried forward as a sole trader not sure think not.

That was my vague memory, I think if you form a company you can include several years expenses/losses, but i'm not certain

 

[JamezF]

If you form a limited company however you will need to submit proper accounts to companies house every year as well as doing a company return. If you store any data on a computer, the ICO will try to get their shovel in as well. I doubt you'd see much change from £750/year.

James