Should I Register to Get Paid For Occasional Photography?
Q.
I have been doing photography as a hobby for the past few years. I have been building up my profile by doing free shoots. All my work in my portfolio I have uploaded and made a website which is registered as a .co.uk.
Someone told me you need to register your business even if you just get paid for the odd work you do and that the inland revenue might track me down and I will get fined.
This is just a hobby which I am thinking of going freelance as I currently receive tax credit and working families tax credit as my husband only works part time.
A.
Your question perfectly demonstrates the minefield that can face aspiring photographers wishing to do ad hoc work, either in order to complement other income or simply as a hobby. The regulations facing people who wish to work in this manner can be challenging and off-putting.
You will be pleased to know, however, that you are probably under no obligation to ‘register your business’. There are, broadly, two ways that you can carry on business as a photographer; you can either act as a sole trader, or you can incorporate a company – thereby becoming a ‘limited’ company, or similar legal entity.
There is nothing to stop you carrying on as a sole trader. As a sole trader you can take on any work, photographic or otherwise, as long as it is legal. There is no obligation to register your business with Companies House. However, if you are charging for the work then you may well have a tax liability. If you earn more than the personal allowance in any year (currently set at £6,035), you will have to pay income tax. Regardless of this, as a sole trader you are considered to be self employed.
As such, you must complete a Self Assessment tax return every year. This is not necessarily a complicated process, particularly if you have not done much self employed work in the preceding year. However, if you have any self employed income you are obliged to complete a Self Assessment return. You must also register as self employed with the Inland Revenue within three months of the end of your first month of self employment.
You also mention that you receive various tax credits. It is important to remember that any money you make from photography will be treated as income, regardless of whether it is derived from self employment or conventional employment. As such, this may have an effect on your ability to claim tax credits. You should contact your Tax Office as soon as you have registered as self employed in order to clarify the situation.
In conclusion, therefore, while you are not obliged to register your business with Companies House, if you are charging for your photographic services you must register as self employed with the Inland Revenue.
