Being self employed, is it worth it?

Good site.

As a self employed person fro the last 12 years it does feel like you are working for the inland revenue as yet another VAT bill becomes due. If it's not VAT that's due, it's income tax, or PAYE & NIC for your staff. In these difficult financial times, I look around my local town and wonder if it's worth it. Local businesses closing down at an alarming rate, an increase in £1 shops & charity shops, reduced margins.My job satisfaction has long gone.

M, Nice to hear you're still hanging in there. Have you claimed "Use Of Home As Office" as an expense?

It sounds as if you have set up your business and done quite well at it. But you are right. The tax threshold should be raised to, say, £10,000. To pay tax under this level is ridiculous. But keep at it because once you are self-employed you definitely won't want a boss ever again. It's better to work twice the hours you would in a job to gain the satisfaction of knowing what you are capable of. In time I am sure, if you can keep overheads low, you will earn more and have a viable business and maybe you can sell it on one day.

I have been self employed, for the last 14 yrs and wouldn't have it any other way!
Like the man said though, is your business profitable enough to carry on with?
The worst thing you can do, is pay your bills with a credit card!
You may as well go bankrupt now and save yourself the grief, if you go down that road!!

To the original poster - I think you answered your own question.

Here's a bit of an update. Phoned the Inland Revenue and spoke to a nice chap who has set up 6 months worth of Direct Debits to help me spread the Tax payment out a bit. He was very sympathetic when I explained the situation. Only thing I need to do now is find the cash for the payments each month. Still, that should be easier than finding a lump sum. Lucked out on a job opportunity last week so that's blown that chance. It could be worse though, people are loosing their jobs left, right and centre. At least I still have an income.

There is no such thing as being self employed. we just work for the government much harder and longer!

BBBB, I think we live in different worlds. I used to live in yours too and trundle into an office every day to make a living. Being self employed has its good points and bad points. The £350 in the big world probably isn't a lot, but down here it seems like a fortune.

MrCoffee: Yes, I'll carry on. Got a sniff of a job here and there at the moment so I'll take a bit of that if I can get it to boost the empty buffer zone (you know, the pot of money you keep just in case). Things are actually looking up a bit at the moment. All set to make almost double what I did in December (a very poor month at the best of times).

Here's to hangin' there... whatever you're doing.

I have income below the personal tax allowance but I have been taxed| How - via "council" tax. I can claim none taxed gross interest - yet I am still taxed - via this tax. In other words my income including interest is supposed to be none taxable (because it is so little) Yet the revenue claims tax from me because it has perverted rules that enable it to do so! This enables its local collectors to deem me able to live on a sum below even the state pension - let alone the personal tax allowance!

This injustice and ruthless exploitation is being practised against each end of the generational range - via tuition fees and student debt and via twisted rules exploiting the elderely. I too was in debt - as students are -actually to around £50,000! On top of this cynical campaigns seem to be run to set the young against the old - a political trick! Its sick!!!

You make a small profit, then okay. I would actually just stick at it, as you said we are heading in to a recession and finding work is harder than ever!. Keep putting the work in, you'll survive and it'll all be worth it one day.

A £350 tax bill for the year!!

I get taxed double that PAYE a month.

Hi Phil,

Thank you for your kind comments. My income is very low, but it's mostly profit because I have very little expenses. I work from home and I claim my internet connection and any computer related stuff that I buy. Unfortunately not much in the last year or so of that, a desk and a chair totalling £40. My broadband is business grade so I claim 100% of that obviously, hosting fees etc. Anything the missus bought computer related, DVD's etc. claimed (again, not much). I also claimed a portion of heat/light, again - not sure what the portion you can get away with is so I just made it reasonable and tried not to take the p**s.

I filed my return myself and I don't have an accountant because I couldn't afford one. I doubt he'd be able to save me enough money to pay his £400.

Things really are tight and on the edge. My tax bill for the year was around £350 so that ought to give you an idea how little I earn. MrCoffee says my business isn't profitable. Actually it is, because it's mostly profit, just not much of it. I spend long hours in front of a computer, but as I said before it isn't really work to me and I get paid enough to live on (just about).

I'll stick with the self employment thing Phil because as you pointed out, one of 3% is quite an achievement and I have the satisfaction of knowing I'm making my own roads which one day may lead to a more comfortable income. Who knows, might be able to afford an accountant one day!

By the way, thanks for the info on Class 4 - I must have completely missed that. I was probably to fixated on the whole tax thing and assumed the NI wasn't a big deal. There you go, I've learned something else!