How do I go about declaring affiliate earnings?

[MortimerJazz]

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So I've started to see a trickle of affiliate earnings each month, which has got me thinking about how these sort of earnings should be declared.

Is there someone I need to contact, a form to fill in? What sort of process is involved?

Thanks alot

[darrenb]

Basically if you are in the UK and not trading as a company then you should declare yourself as self employed and complete a tax return (self assessment). Inland Revenue need to be notified that you are earning additional income which should be done within the first three months.

More information here: HM Revenue & Customs: Self Employed

[Mogga]

You should have registered within 3 months of starting self employment.

HM Revenue & Customs: Self Employed

Give them a ring - they're very nice really. If you've only just started earning money then you should be ok.

[hrbs]

Is there someone I need to contact, a form to fill in? What sort of process is involved?

Thanks alot

Hi
I have written a number of free guides at tips.hrbs.biz including how to register with HMRC, a list of tax deductible expenses and various Affiliate Marketing guides.

The key is to register with HMRC within 3 months so that you are not fined, see
Thinking of starting a business? . If you are likely to have profits for the current tax year of less than £5,435 , you can apply for the small earnings exception - the form is at http://www.hmrc.gov.uk/forms/cf10.pdf .

If you have a "dayjob" which pays approx £40k you can apply for deferment of NIC - HMRC guidance is at HM Revenue & Customs: Deferment of National Insurance contributions .

I would strongly recommend that you open a second bank account for your AM earnings and costs as it makes your administration much easier and keeps your personal transactions out of sight of HMRC and your accountant.

Good luck!

Keith
Fixed Fee Accountants and Tax, VAT, Payroll Specialists providing proactive, professional service to small businesses - HRBSaccountants.com

[MortimerJazz]

Thanks Keith,

Much appreciated. Are there any links you can give me which might help with understanding the benefits of things like the small earnings exception and the deferment of NIC?

[sgpratley]

I thought it just involved getting someone to take a photo of you holding your cheques and posting it on a blog

[hrbs]

Thanks Keith,

Much appreciated. Are there any links you can give me which might help with understanding the benefits of things like the small earnings exception and the deferment of NIC?

Hi

HMRC guides ...
NIC Small earnings exception - claim to be exempt from class 2 if earnings are low.
Form is at http://www.hmrc.gov.uk/forms/cf10.pdf and threshold is at http://www.hmrc.gov.uk/rates/nic.htm

NIC Deferment - http://www.hmrc.gov.uk/nic/deferment.htm .
Form is at http://www.hmrc.gov.uk/forms/ca72b-08-09.pdf
If your earned (not self employment) income is over £40,040 you can apply to defer paying class 2 and class 4 NIC (payable on profits from self employment).

If you do not apply to defer you will pay class 2 (fixed rate) and class 4 NIC and then claim a refund after your tax bill for the year has been paid and agreed.

NIC refund info at http://www.hmrc.gov.uk/nic/refund-nic.htm

General NIC FAQ is at http://www.hmrc.gov.uk/faqs/nicqse.htm .

Regards

Keith
http://HRBS.biz