How to go about permanent job and job aside

Dagged

Hi,
I was searching forum but couldn't find any answer.

So basically I have a permanent job but recently I've started to do few small jobs aside. I am thinking about opening my own business but for now I don't want to leave my current job. I don't want to register a company, because I am not sure whether it is going to be successful or not. I know I can register just for the tax purposes (sole trader) and pay my tax on my own or my employer deduct from my salary
My question is:
How long can I run business without the tax registration. (I just want to try and see if this may generate any profits if not and I'll quit)
I don't want to pay a tax if I don't get any profits however I do want to do this legally.


Regards
Dagged

DoMyBooks

You cant run any sort of a business without registering for at least income tax on the profits.

The big advantage of registering as self employed while working in PAYE is if your small business makes a genuine tax loss you can use this loss to claim a refund of PAYE paid.

Dagged

DoMyBooks wrote: »

You cant run any sort of a business without registering for at least income tax on the profits.

The big advantage of registering as self employed while working in PAYE is if your small business makes a genuine tax loss you can use this loss to claim a refund of PAYE paid.

In this case will I pay more tax before I can claim tax back ?

DoMyBooks

You just pay your tax on your salary as normal. You don't pay any extra unless your tax accounts show a profit.

Dagged

Sorry maybe for stupid question, but I have to undersand it correctly:

For instance in June I won't sell anything (as sole trader) - for this month I will not pay anything extra just regular tax from my job. And The next month I will sell one thing , so I will pay extra tax only for this one thing ? And it doesn't affect my job solary ?

The other question is : can I resign on any stage and close business or not (if i don't have any debts of course).

DoMyBooks

No problem tax can be confusing. You pay your tax annually based on your taxable profit.
If you do decide to go self employed you should either do some research on revenue.ie or else hire an accountant.

This extract from the revenue website should help you out.

Persons coming into Self-Assessment for the first time
You are advised to make a payment of 90% of the estimated liability for the first year of trading. If, for example, your tax affairs for 2008 were dealt with under PAYE and you commence as a self-employed person in 2009 you can make a payment of Preliminary Tax on 31 October 2009.

Note that if you chose the option to pay Preliminary Tax of 100% of the previous year's liability (i.e. liability - net of PAYE tax but increased to take into account the amount of income levy that would have been paid had the income levy applied in 2008) a payment of Preliminary Tax does not generally arise for the first year.

An individual, who enters the self-assessment system because they have commenced in trading, have until the return filing date for the second year to submit tax returns for both the first and second year trading. However, as mentioned previously, early filing of returns is advisable, as it allows an individual to know in advance of payment deadlines what tax is due.

Early filing does not bring forward the payment date

However, if you commenced as a self-employed person in 2008 you must, under the Pay & File system:

pay Preliminary Tax for 2008 on or before 31 October 2008,
pay the balance of Income Tax due, if any, for 2008 on or before 31 October 2009,
pay Preliminary Tax for 2009 on or before 31 October 2009,
pay the balance of Income Tax due for 2009 on or before 31 October 2010,
file your tax return for 2008 and 2009 on or before 31 October 2010.

Dagged

Ok, Thank you it looks very complicated . What if my income will be very, very small let say €500 p.a. ? I know that most of the people for this amount won't go for self-employment but I just want to be ok with law... And the other hand if I'll finish with figures like that I won't bother my self and stop trading. I am not too sure if my business will pay off... But to try it I want to have all things sorted out.

Dagged

Hi all,
I just find out. All I need to do is register for tax not even for VAT. If I'll go over 36k or something around than I have to go for Vat. I can keep this separately for my current job, they even don't need to know that i have my own "business"

@DoMyBooks thanks for help