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>Hi Nick, how's things?
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>The main reason I wanted to know was that there may come a time when I'm doing a lot of work for this company, and if such time arises I want to be prepared to do things by the book.
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>What exactly is the procedure for declaring tax? How much tax do I pay? Who issues the tax payment? Me or the company?
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>Some info would be grateful, are you still contracting?
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>Thanks
>Kev

Hi Kevin

I'm still self employed but the market has pretty much dropped out of the traditional fox contract market here. I'm still managing to find find work by myself, also I am thinking of developing and marketing packages. Let me know if Cornwall have any requirments while you re train in C# :>

There are several answers to your questions.

The other company can choose to employ you as a PAYE employee.(Not good for them. Its expensive as full time employees incur a lot of overhead etc)

They can pay for your work as a freelance (You can then choose wether or not to be a limited company)

You could charge them an hourly rate or a fixed price.

I would expect that you don't need to be a limited company. It adds costs for you, your accounts etc become more expensive.Most contractors in the UK have limited companies because the agencies require it and if earning large amounts you can save some money.

You would have to declare the extra income on your tax return and pay any tax due. But as I mentioned any costs that you incur because of the work are deductable so reducing your tax.
(even if they employed you as a PAYE employee you would still have to declare the income because it may put you into the next tax bracket).
You have earned the money so you pay the tax.

You probably don't need an accountant yet but the best and free source of advice for you over this work (and if its likely to be a large amount I really would start of correctly) is the tax office. They have a helpline you can ring with this sort of query.

Hope that Helps

Nick