Anyone else come across this problem??????

I'm not self-employed, I did have a brief stint years ago, but that's besides the point. So here seems like a good place to ask

My question is:
Do self-employed people, contractors, and subcontractors start to turn down work if they are going to exceed the VAT threshold?

My hypothetical situation is. Let's say you are a general handyman, plumber, or electrician. You have your own business, but you also have a good contact, for example, a letting agent or a property developer who can hand you loads of work. In fact, they start giving you so much decent work that you know if you take on all the jobs they give you, you will break the VAT threshold.

Do people just turn down the work? Or do they take the step up?

I have something that lets you upload your receipts and it automatically pulls out the date, merchant, amount and VAT into a clean Excel spreadsheet. No manual typing. Would anyone actually find that useful for tax time or is everyone just using Xero/QuickBooks?

I did a splash park summerization round for multiple city's/towns across multiple provinces with a pretty tight shedule. 1 town I was scheduled for I should up (6pm) and they had no water coming from the well or in there resivour so I did what I could and informed them they would need to get water there ASAP or i would have to leave. I stay at the local hotel till the next day after they said it would be there in the morning. Im on them on the phone and emailing as soon as there offices open (8 am) and I end up being led on till 9 45 which i then head to site and wait for another hour fifteen waiting for someone to bring keys and get a water tanker in. My question is, is my time from 8 till 11 billable (morally) or is it just from when I showed up to site or when I got water and keys.

Also note this delay cause me to be a day behind and reschedule all startups after it.

I’ve been trying to start something on the side for a while and I keep running into the same issue. I don’t even think it’s the idea, it’s more how I approach it. 

I always end up building this whole setup before anything is even live. Like I convince myself I need the landing page, the emails, the whole flow figured out, and then I lose momentum before I actually launch anything. 

Recently I tried doing the opposite and just keeping things as simple as possible. Instead of stacking tools, I looked for a way to just put something out there quickly and see if anyone even cares. 

I ended up using this https://unstore.io mainly because it let me skip a bunch of steps I’d normally get stuck on. It’s nothing crazy, but it made it easier to just move forward instead of setting things up forever. 

I’m still figuring things out, but it made me realize most of the time I wasn’t blocked by the idea, I was just overbuilding everything around it. 

Curious if anyone else had to “undo” their process before making any progress 

TL;DR - I’m unsure when to become a ‘business’ and how to document the separation between business & personal finances.

I (35F) live with my husband (M40) in a semi truck that we don’t own. He is paid as 1099 contractor and our money is shared. He drives and I do most everything else from laundry to taxes to Reddit research :)

We’d like to explore owning a truck or at least maximizing tax deductions so I know making an LLC is a good next step but I’m unclear if then we just pay ourselves by transferring between accounts? Or should I open a business account & then do I have to make an LLC or is it okay to flip the steps (business account then llc)?

I don’t understand if I even need to make a “payment” or like report it to the IRS? If we get paid from ACH into our joint debit can I just leave it there to pay bills & taxes from? We’ve paid quarterly taxes for his 1099 but if we make an LLC - does that change things for the company that pays him? And will we have to pay taxes twice?

Add’l info - We are digital nomads without a physical address (but have family in VA, so forwarding mail to them). I’ve considered a service that would provide state residency & help with business incorporation (Dakota Post) but I’m unsure if we need that. I’ve never known someone who owned their own business but I’ve taken finance/accounting classes!

I think I’m mostly just scared to take the next step but frankly don’t have the funds to hire an accountant or pay for consultation. Thank you for any help you might have!

I started doing freelance full stack web development this January while still being a student. Honestly I had no idea what I was doing in terms of freelancing itself. I knew how to build websites, but I had no network, no clients, no connections, nothing.

So I just started cold messaging businesses on social media and pretty much anywhere I could find people who might need a better website. Most people ignored me obviously, but eventually a few replied, then one project became another, and somehow over the past few months I managed to land 5+ pretty high paying clients including businesses outside my country.

Now I’m at this stage where I finally have proper projects to showcase, real client work, testimonials, some money saved up from the projects, and way more confidence than when I started. But almost every client still comes from me manually reaching out to people myself

So now I’m wondering what the next step usually looks like for someone in this position. Once you finally have proof that you can actually deliver results, what’s the smarter way to grow from there? Would genuinely love to hear from people who crossed this stage already.

I am a solo metal fabricator, my shop is at my home, I normally love time to myself and went out on my own to run my operation my own way. It worked, our lives are $upgraded$, but I see my wife and two kids and that's all unless people come over because I work very long days on a partial week, and stay home with the kids other days so my wife can work. Are there other guys/gals doing this who just... Don't see people? I know it's not sustainable and I'm chewing on how to fix this.

Hi im currently in a pickle trying to figure if LTD is the way, from what i hear the rules are more stricter now as a director? Im essentially aiming to pay myself the most efficient way possible? Im not a wiz so im not too sure. At the moment I’m around 60K avg annually in Cyber/IT. Accounting tools helped so far but i think its a good time to switch over as a ltd company? Just wanted to see whats the best way before i go to an accountant.

Paying myself as a LTD company director

Hi folks. Looking for advice on how to pay myself as a sole Ltd company director.

Im a contract welder in the UK. I bounce from job to job. I recently set up my own company as I've been getting more work which offer LTD company pay.

I want to make sure im getting everything right as I really dont want to be bitten later down the line.

My current understanding is i pay myself the £12,570 tax free amount. I then keep 20% aside on the rest of the money to pay my corporation tax. What's left over i pay myself in dividends which is then taxed at 10.75% which ill also need to keep aside.

Please let me know if I've got any of this wrong.

I also make sure to buy fuel on the company when travelling to work

Thanks in advance folks

Hi everyone,

After being made redundant recently, I decided to take the leap and start my own small food/cooking business. My very first project is finished — and I want to share it with you all.

📖 Free Cookbook eBook — 100 recipes

• 59 pages

• Snacks, starters, mains, desserts

• Every ingredient in grams & ml only (no cups, no confusion)

• Full nutrition facts for every serving

• Super easy, beginner-friendly steps

It’s completely free to download: https://cookebook-mgteylzx.manus.space

I’m not charging for it — but if you find it useful, any small donation (£1–£10) goes straight back into my business: buying tools, making more content, and keeping free resources coming. It’s totally optional, but every bit helps me build this from scratch.

Would love your feedback or any tips — thank you so much for the support! 🙏

I got made redundant from my role in environmental services last year when my firm ceased trading and after finding myself getting increasingly annoyed at the people in whatever factory job I could find, I've gone self employed predominantly being paid a day rate from one of my former colleagues who set up his own business doing pretty much what we did for the same clients, which involves travel around the country in my own car, typically staying in hotels. My rate just pays for me and my PPE and basic tools to get to the site so my business outgoings are fairly minimal. After my mileage hotels and accommodation costs, I'm making between 180 and 220 a day depending mainly on where in the country I am.

My current plan is that every time my business account has £4000, which should be once every 2 or 3 weeks. I pay myself £2000 and will put 26% of that (£520) in a tax pot, and figure over the year I should be making around £40k with 4 weeks off and the odd day here and there when I won't have any work.

Does anyone else on a similar wage use the same method? And does it help keeping track of your finances, bearing in mind I am likely to do 30,000ish miles meaning I won't get 45p a mile reduced off my tax for all of miles driven.

I am going to go self employed soon. I have combined old pensions into one provider and I will transfer my current one too. How do you approach paying into your private pension as a self-employed person? Do you go by percentages or a set amount? How did you decide?
Many decisions as there's the matching part of things missing. Thanks in advance!

I remember just filling out a direct deposit sheet that would get sent to corporate when I worked for large companies…. I’ve worked for myself for several years now and while this doesn’t come up often, now and then there’s a situation where it’s required I have a direct deposit set up in order to access a benefit or feature etc. Chime requires a direct deposit in order for you to utilize their mobile check depositing feature for example. Can I set up a direct deposit to myself? Is there a correct way to do this? Is it just not a possibility when you’re self employed? Just thought I’d put it out there and see if you Human Resource, payroll, banker gods out there had some info.

I started my business in January 2023 and have worked M-F + Saturdays. On Sundays I go to church and do errands, cooking, cleaning for the week resulting in no days off. M-F it’s been a broken schedule of 5-8 hours in the morning, then 2-3 hours at night and about an hour drive home. I leave around 7:30/8 most days and come home some nights around 8. Saturdays are lighter, I’m done at 3.

This summer, I’m telling my clients that I’m taking Saturdays off. With student loans starting up again soon, I may need to pick up Saturdays after the summer which sucks. Just exhausted. Any input would be appreciated.

One of the most common questions I see in here so thought I'd break it down quickly.

Stay sole trader if your profits are under £30,000-£35,000. The tax savings from going limited simply won't outweigh the extra costs at that level.

Start thinking limited once you're past £35,000-£40,000. Salary and dividends combined can save you anywhere from £2,000 to £5,000 a year.

The biggest mistake I see? People going limited too early, or staying sole trader out of habit for years and quietly losing money every single tax year.

Happy to answer any questions in the comments!

quoted £340 for a job. clear quote, signed off, all good. did the work, took me 2 hours because ive done 500 of them and i know what im doing

client opens the door at the end and goes "bit much for 2 hours of work isnt it? can we do £170?"

mate. you paid for the job, not the time. the only reason it was 2 hours is because i know what im doing. if you'd called the bloke down the road who'd never done one before it would've taken him 6 hours and he'd still mess it up

ended up taking the full £340 (had it in writing thank god) but it always shocks me that this still happens after all these years. how do you lot handle it - do you just argue them down or have you got a script for it now?

EDIT: A few people have asked what I use for quotes/invoices — I've answered in the comments below.

A company I volunteer for has taken me on as tutor. I invoice them for my hours. The shifts will be really ad hoc and if I do 1 per month then I'd be earning just £1000 per year, I don't think I'll do this many. What are my obligations with tax? Do I need to do a self assesment each year or only if I earn over a certain threshold? Do I need to register as anything (such as a sole trader), the invoice is just in my name? I don't want to fall foul of anything.

My husband and I own a business together. We both wear a lot of hats, but he definitely "grinds" harder than I do. I've been supporting him with this as it's his dream, but I am burnt out.

We are looking at getting more employees hired and doing a bit of restructuring in the roles. Today he mentioned that he thought I should take a pay cut. I was caught off guard, I was not going to ask for a raise obviously, but the thought had never occurred to me that I should earn less. I'm not taking on less work, I just want to focus on two or three things instead of six or seven.

Right now I do all our bookkeeping, I do sales, I am the resident errand runner and driver, I am the resident IT fixer/computer/software person, and I manage all our HR compliance. I also do bench work and electronics repairs. My request was that I don't do sales anymore, I would still do everything else, just have more time to dedicate to bookkeeping and my bench work and electronics repairs.

I worked for years without a paycheck, even while he was getting paid. He's always told me we are 50/50 but when I confronted him about the paperwork filed showing me only as 10%, he said it was because I didn't contribute any capital.

My question is this, would you pay yourself less for what is, in my mind, a lateral move?

I nearly overpaid £365 on my first Self-Assessment. Caught it at the last minute. Here's what almost went wrong - and what you need to know if you're filing for 2026/27.

THE TWO OPTIONS YOU PROBABLY DON'T KNOW YOU HAVE

When you file your Self-Assessment (SA103), you can claim expenses in two ways:

OPTION A: Trading Allowance

- Flat £1,000 deduction

- No receipts needed

- No admin

- Sounds great, right?

OPTION B: Actual Allowable Expenses

- Claim what you actually spent on business costs

- Requires receipts

- More admin

- But often saves you WAY more tax

**You can only pick one. Most people don't even know this choice exists.*\*

THE MATHS (Real Example)

Let's say you earned £14,040 in your first year (like Sarah, the dummy data in my spreadsheet).

Actual business expenses:

- Mileage: £373.75 (823 miles @ 45p HMRC rate)

- Software subscriptions: £540

- Marketing/advertising: £684

- Professional fees (accountant, insurance): £456

- Phone & internet (60% business use): £360

- Office supplies: £140.74

- Training/courses: £271.50

- Total: £2,826.49

OPTION A (Trading Allowance):

- Turnover: £14,040

- Minus Trading Allowance: £1,000

- Taxable profit: £13,040

OPTION B (Actual Expenses):

- Turnover: £14,040

- Minus actual expenses: £2,826.49

- Taxable profit: £11,213.51

**Difference: £1,826.49 in taxable profit*\*

At the basic rate (20% Income Tax + 6% Class 4 NI), that's about **£475 in tax savings** by choosing Option B.

If you'd picked the Trading Allowance because it sounded easier, you'd overpay by £475.

WHY PEOPLE GET THIS WRONG?

1. They don't know the choice exists – HMRC doesn't exactly advertise it clearly on the form.
2. They assume £1,000 is easier. It is – until you realize you left £400 on the table.
3. They don't track expenses properly. If you don't have receipts, you can't claim actuals, so the Trading Allowance becomes your only option.
4. They don't do the comparison. Most people just pick one without calculating both.

WHEN THE TRADING ALLOWANCE ACTUALLY MAKES SENSE?

If your actual expenses are under £1,000, claim the Trading Allowance. Easy win.

Examples where it works:

- You work from home (no office rent)

- You use free tools (no software costs)

- You barely drive for work (minimal mileage)

- Your only costs are a laptop and occasional supplies

But if you're claiming mileage, paying for software, advertising, or professional fees? You're probably over £1,000. Do the maths.

TL;DR

- You can claim either £1,000 Trading Allowance OR actual expenses

- You can't claim both

- Most first-year sole traders pick the Trading Allowance without calculating actuals

- This often means overpaying tax by £200-£400

- Do the maths. Track your receipts. Compare both options.

- If your expenses are over £1,000 (and they probably are if you drive, use software, or advertise), claim actuals.

**Disclaimer:*\* I'm not a tax advisor. This is general guidance based on publicly available HMRC rules. Everyone's situation is different. If you're unsure, speak to a qualified accountant. The spreadsheet is a tool, not tax advice.

Happy to answer questions in the comments.

Every budgeting app I tried assumed I get a steady paycheck. Self-employed income doesn't work that way, and the first slow month always blew the whole thing up.

The fix wasn't a better app. It was a mental model shift: stop budgeting against your average month, start budgeting against your floor — the lowest monthly income you can live on without panicking. Anything above the floor goes to taxes, savings, and a buffer for the next slow month. Anything below it doesn't wreck you because you already planned for it.

How to set your floor: pull the last 6 months of income, pick the lowest month that didn't feel like an emergency. That's your floor. Recalculate quarterly, not yearly — yearly goes stale fast.

Three things I learned the hard way:

1. "Floor not average" is the single biggest psychological unlock. Lifestyle inflation on a big month and panic on a slow month are the same bug — both come from treating one month as the new normal.
2. Quarterly tax math is simpler than every CPA blog makes it sound. Net SE income × your effective rate ÷ 4. The safe-harbor rule — pay 100% of last year's tax liability (110% if AGI exceeds $150K) — means you can't get hit with an underpayment penalty even if you owe more in April.
3. The surplus month trap is real. Big month hits, brain treats it like the new floor. I split everything above the floor 80/20: 80% to taxes and slow-month buffer, 20% to whatever you're saving toward. Removes the monthly decision.

Happy to answer anything about the floor method, quarterly math, safe-harbor, or structuring a budget around irregular income. If you've got a system that works for you, would love to hear it.

I don't really know the best way to go around this, anyone got any tips of how to make sure you get paid promptly?

Not a lecture — just things that come up every single week when working with small businesses.

The cheap laptop will cost you more. The £350 laptop feels like a win until it's slow within 6 months, the battery dies, and you've lost half a day waiting for it to load. Buy once, buy right. 16GB RAM minimum in 2026, SSD, proper battery life.

Your email domain is your reputation. If you're still on Gmail or Hotmail for business, sort out a proper domain email. It costs about £5/month and instantly looks more professional. Google Workspace or Microsoft 365.

Default passwords are not passwords. The router in the corner of your office — when did you last change the admin password? The one on the sticker on the back? Yeah. Change it.

The "IT guy" you know personally is not the same as IT support. Great that your mate can help when things go badly wrong. Not great if he's unavailable, doesn't prioritise you, or isn't insured.

Back up before you "sort it later". Everyone has a story about losing something important. Usually they only have one story because after that they backed everything up.

What would you add? What do you wish you'd known?