Hi.

You only pay tax on the profit you make, not what you sell an item for. Even if you made the item yourself, the materials would have a cost to you.

The type of business you will be running will dictate the types of expenses you will incur. Take a look here for a basic list. If you are selling online, you will have website costs, eBay charges if you sell through that site, credit card processing fees etc. When you spend some money, all you have to do is ask yourself whether the purchase has a connection to your business to determine if some or all of the expense can be claimed.

You need to keep a record of your business income and expenditure including receipts and invoices. The tax office do not like traders claiming for expenses they cannot prove. If you use a credit or debit card, then the credit card or bank statements will show exactly who was paid but you should keep the receipts and invoices in any event.

You will need to register with the tax office as self-employed and you can do that here. At the end of each tax year which runs from 6 April to 5 April you will be issued with a tax return to complete. You will find it easier if you have 5 April as your business year end so it coincides with the tax year. You can read about the tax return and paying your tax here.

Let me know if you have any further queries.

You can be both employed and self-employed at the same time.

As far as record keeping is concerned, its up to you how detailed you want to be. Some people don't keep a written record at all. They just put all their bank statements and receipts and invoices in a box or an envelope and write up an income and expenditure account at the year end.

You can save yourself time if you keep a written record of money coming in and going out on a weekly or monthly basis depending on the volume of transactions you do. A simple exercise book would probably suffice. I've seen records where clients start from the front of an exercise book for income and from the back for expenses.TonyTax41051.8895372338

The self-employed usually pay their taxes twice a year, on 31 January and 31 July. There is nothing to stop you sending payments to your tax account with the Revenue monthly. When your liability for a tax year is quantified, the advance payments you have made will be used to settle some to all of what you owe.

It's difficult to say how much you should be putting aside as that will be dependent on your business income and expenses and what you earn in your job. If you are a basic rate taxpayer, you wouldn't be far out if you put aside between 20% and 25% of your net profit.