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Do you have a Second Income? own up now!

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On the 9th April 2014 HMRC launched the Second Income Campaign….

A second income could come from:

  • consultancy fees, eg for providing training
  • organising parties and events
  • providing services like taxi driving, hairdressing or fitness training
  • making and selling craft items
  • buying and selling goods, eg at market stalls or car boot sales

You need to tell HM Revenue and Customs (HMRC) if your additional income hasn’t been taxed through either:

  • your main job
  • another Pay As You Earn (PAYE) scheme
  • Self Assessment

This is called a ‘voluntary disclosure’. To get the best possible terms you need to tell HMRC that you want to take part in the campaign.

You’ll have 4 months to calculate and pay what you owe.

You can find out about the campaign and how to make a disclosure here

The criteria used to assess if an activity is a hobby or a business are:

  • The size and commerciality of the activity.
  • The frequency of the activity and transactions
  • The application of business principles.
  • Whether there is a genuine profit motive.
  • The amount of time devoted to the activities.
  • The existence of arm’s-length customers (as opposed to just selling your wares to family and friends).

If you have a Second Income its better to disclose it now rather than wait till HMRC find you.

steve@bicknells.net

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