Employed - Hobby Earning More on the Side?

Curran

Hi folks,

Already in a full time job - however, I work shift work; and I have alot of spare time! One of my hobbys; I believe I could make a few quid a week doing.

I was wondering; as I am paying tax already, am I subject to tax on 100% of the earnings from my hobby / extra earnings? Or what way do I declare it!
However, I would need certain materials for this business - so a VAT number would make supplies cheaper and profits greater so....
Would it be best to start up a business and be a separate entity - would this business then have its own threshold of allowable earnings before it would be subject to taxation?
I read on here, cant find it again, that a turnover of up to 35k would not be subject to tax - is this true?
I predict that if I decide to go ahead with it; that I would only earn approx 2-300 per week MAX, as Id only be doing it for 2-3 days a week; which would be below 35k a year.

If my cash earning hobby / business was to be successful; Id consider it full time and partnership my brother as he's getting let go from employment soon!
However, the way the economy is at the moment, I dont want to leave my employment and chase this, without knowing its going to be reasonably successful.

Advice please - cheers!

Bookkeeper09

Curran wrote: »

Hi folks,

Already in a full time job - however, I work shift work; and I have alot of spare time! One of my hobbys; I believe I could make a few quid a week doing.

I was wondering; as I am paying tax already, am I subject to tax on 100% of the earnings from my hobby / extra earnings? Or what way do I declare it!
However, I would need certain materials for this business - so a VAT number would make supplies cheaper and profits greater so....
Would it be best to start up a business and be a separate entity - would this business then have its own threshold of allowable earnings before it would be subject to taxation?
I read on here, cant find it again, that a turnover of up to 35k would not be subject to tax - is this true?
I predict that if I decide to go ahead with it; that I would only earn approx 2-300 per week MAX, as Id only be doing it for 2-3 days a week; which would be below 35k a year.

If my cash earning hobby / business was to be successful; Id consider it full time and partnership my brother as he's getting let go from employment soon!
However, the way the economy is at the moment, I dont want to leave my employment and chase this, without knowing its going to be reasonably successful.

Advice please - cheers!

Hi there,
All of your income from your hobby would be subject to tax.
If you are not fully using your tax credits in your other job they can be offset against this. You would need to fill out a tax return each year... has to be submitted by Oct/Nov for the preceeding year...ie incoem earned in Jan - Dec 2010 would have to be included on your 2010 tax return and submitted to the Revenue in Oct/Nov 2011.
You possibly would not be oblidged to register for VAT due to the level of business at present but this could change. You can opt to voluntarily register for VAT but you would also have to charge VAT on any of your sales so would need to consider this when you are pricing.

Curran

Cheers for the reply Bookkeeper!
All tax credits would be used in the current job!

You possibly would not be oblidged to register for VAT due to the level of business at present but this could change

At what point would you be obliged to pay VAT?

So if I register a business to get a VAT number or opt to voluntarily register for VAT - I have to charge VAT on anything that I sell - even if I sell a small volume?


Sorry - Im not the well up on the Tax side of things - as you can see!!
Thanks for the help folks!

Mr. Incognito

Read the VAT guide in the stickies. This should answer your questions. There is also one there for starting a business.

No point incorporating a business as a rule unless your income is over 50K a year due to all the red tape.

Curran

Thanks for the reply Mr. Incognito
I did have a look throught the stickies although it was a 4am this morning!
I'll have a closer look again!

Interesting - so no point in setting up a business unless I earn 50k+ / year! :eek:
So Im better off delcaring my extra earning in the tax returns in Oct/Nov of the following year!

So would I be correct in saying that....any earnings made on the hobby / side earner, that supplements my current salary would be charged at....
20% on the earnings that would bring my income up to €36,400
And 42% there after??

betonit

you can also write off expenses incurred for running your side biz. Percentage of Light & Heat , phone etc. Though your credits are maxed and probably will be paying most of extra income at 42% these expenses will reduce the bill some way. See an accountant.