Hey everyone,

I’m hoping to start up my own, small Internet business and start working from home; initially earning a second income, with the hope of making a living out of it. I have the money to invest to start the business up and I realise I would need to class myself as self employed. This obviously means I would personally be responsible for paying the stoppages that go out of my current earnings like tax and national insurance.

This means I have to keep very good records or “books”. My question is, how do I do this? I assume I have to calculate the stoppages based on the
income, but how? Also, probably a stupid question, but do you have to pay tax every month like I do in my current job, or do you write off a big cheque at the end of the tax year when you do the tax return? Or both? And when in the month would you have to pay out these stoppages?

Ideally, I’m hoping for advice from someone who is currently freelance or has had experience of it. Or at the very least, someone can provide me with links to the information I’m looking for.

I’ve been directed to the site: http://www.businesslink.gov.uk/bdotg/action/layer?topicId=1083764940&r.s=p&r.pp=11&r.l1=1073858805&r.lc=en&r.li=1083828647

Although the information here is very good and useful, regarding the “book keeping”, there doesn’t seem to be the information about how it’s done which I’m trying to find (unless of course, I haven’t looked at the site properly enough).

I’ve heard that it’s wise to use a program called “Sage” and I know I would have to meet with an accountant every so often. Would using Microsoft Office Excel suffice (at least in the short term) and what would I need to construct? Would a simple profit and loss spread sheet be acceptable or do you need to do something a lot more complex than that?

I hope someone can help me soon, I’m hoping to get this new business rolling as soon as possible. Thank you for reading and many thanks in advance for your assistance.