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Going Self-Employed As A Kindle Author

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RE: Going Self-Employed As A Kindle Author

I'd never actually considered writing as being a self employed business. This is probably a daft question, so forgive me, but are there any funds available for new start ups?
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Offline Katherine Roberts Reading I keep forgetting to update this!
27 Jun 2013, 07:06 PM | Post: #22

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RE: Going Self-Employed As A Kindle Author

(27 Jun 2013 03:17 PM)Tim_A Wrote: Wrote:  What do they mean by review? Presumably they want to look at time sheets, word counts, stuff like that?
No, you just fill in a form and sign the declaration... it's simpler than a tax return. (I actually work more hours than I put on my form, since being an author includes all kinds of related things like research, promotional activities, school visits, etc... but I made a guess at average hours spent working on the computer and put that down.)
Offline FrenchMel Reading Darlin' Druid
04 Jul 2013, 09:25 AM | Post: #23

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RE: Going Self-Employed As A Kindle Author

Good luck with your decision. Great advice given, Rosen, as usual.
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Offline Ghoststorywriter Reading Song of Kali by Dan Simmons
04 Jul 2013, 09:44 AM | Post: #24

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RE: Going Self-Employed As A Kindle Author

(27 Jun 2013 02:20 PM)Katherine Roberts Wrote: Wrote:  Alan, I sympathise with you not wanting to claim unemployment benefit. I registered as an author several years before I got my first publishing deal (I was writing short stories for genre magazines back in the 1990's, earning what I suppose would be the equivalent of a modestly selling ebook these days... i.e. 3 figures annually). I asked the Inland Revenue for advice at the time, and they said I must register as self-employed since I was writing regularly with the intention of getting paid, even though my earnings were tiny at the time. I had a part time job as well (riding out racehorses), so I added up my earnings from that and my earnings from writing and did the tax returns with my small figures.

I didn't have to pay any tax or Class 4 NI because my earnings were too small, and was also exempt (by small earnings) from paying Class 2 NI for a couple of years. This actually worked out to my advantage, since at the time you could do "literary spreading" over 3 years. So when I got my first book advance, I spread the income backwards over 2 low-earning years, and reduced my tax bill. (Now you can only do "literary averaging" over 2 years, like farmers do, but it still helps!)

One thing to consider if you're self employed is the Class 4's - currently 9%, which means you're basically paying 29% tax on all earnings above your personal allowance, and (rather sneakily) the Class 4's now kick in at a lower threshold than the personal allowance, which means I think you still need to pay them even if you don't quite earn enough to pay tax.

I've never earned enough from my writing to register for VAT, but understand you can register voluntarily to claim back VAT on things like agency fees, and there is a simplified calculation you can use for smaller earnings.

I only found out about Working Tax Credit a few years ago, when I was between contracts and getting quite desperate. You need to have a bad year before you qualify, but you can claim as an author provided you work the required hours on your writing activities - I know several published authors who currently need to do this. You complete an annual review, and if you qualify they are paid direct to your bank account. I understand this is changing in 2014, though, to a Universal Tax Credit so I'm not sure what will happen then.

I'd suggest visiting hmrc.gov.uk - they have answers to most things and forms you can download, helplines to call, etc.

Good luck.Smile

Hi Catherine. Thanks for your advice. I am feeling very upset at the moment, as I rang Tax Credit Compliance yesterday to give the details of my self-employed writer status as a precondition to deciding whether I was entitled to Working Tax Credit. Unfortunately, they told me that as my current earnings had not yet reached the minimum wage level, I would not be eligible to apply for WTC. I even told them that I would be working 30 hrs pwk on my writing business, but they still insisted that I should be earning this min wage first. How can a business still in its infancy be expected to earn the minimum wage right away? No business can do that in the early stages, so why is the government encouraging jobless people to start their own business if no financial help is forthcoming to support them while the business attempts to grow? I am very annoyed over all of this, and have now referred the matter to my advisor at the Work Programme, who is looking into this for me.
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Offline jesrdesign
05 Jul 2013, 11:46 PM | Post: #25

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RE: Going Self-Employed As A Kindle Author

I'm a full time freelancer (graphic artist, not author) and there are a lot of great resources out there for people like us.  I took the jump to full time about 6 months ago and am happier and more financially free than I was before.
Before I took the plunge, I set myself a goal.  How much money will I need to earn each week to feel successful?  Once I figured that out, I found set out to find a several different sources of income.  Don't put your all your eggs in one basket!
Take up some freelance writing jobs.  Before you go all in, check out some freelance sites.  My favorite is Elance, and before I quit my job, I made sure I had a good reputation there by completing a few projects.  (Note: the hourly jobs arent worth it - work fixed rate if you go this rout).  I usually dont depend on Elance anymore, but I have an established 5 Star rating there, so I know if I'm not going to meet my goal by the end of the week, I can turn there for some income.
A lot of places hire freelance bloggers, SEO and content writers.  Check out forums like WAHM.com and workplacelikehome.com in the Telecommuting and writing forums to find some leads on writing jobs.  The people there are great at helping you figure out which jobs are worth it so you don't have to go through a lot of trial and error.  
It's so rewarding to work for yourself and be successful at something you're passionate about!  Best of luck.
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Offline RobR Reading
06 Jul 2013, 01:57 AM | Post: #26

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RE: Going Self-Employed As A Kindle Author

I joined this group to get away from my day job - but...  To claimTax Credits you need to be working more than 16 hours a week.  You can be self employed.  You simply complete an application form which the HMRC will send out to you (number's in the phone book). The form asks for information on 'last years earning'. Now naturally, this isn't to helpful if you were a high-flying-executive and have only just decided to go self employed as an author.  But, people on modest incomes can still receive tax credits, they are worked out using your family's income and also using the make-up of your family as this adds premiums to the Tax Credit calculations.  Once a year has gone by a review form is issued, this would be where you get the chance to tell HMRC about the thousands of pounds you made selling your ebooks. The amount of Tax Credits adjust then to the new income. And so on...

BTW - There is a permitted earnings figure which if you earn or are just below allows you to claim Job seekers Allowance while working. I think it's around £95 per week. Just ring the Job Centre or DWP and they'll be able to let you know about this and how it works.  As previously mentioned in this thread the CAB can advise on this too.

Universal Credit - It's true that this is scheduled to come in over the next few years and replace many of the benefits now on offer, but claiming will be similar to today, ring up get a form.

One last thing. As a self employed person you can still apply for Housing Benefit and Counciil Tax Reduction, most councils have a dedicated form to fill in for this, a self employed pro-forma.

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Offline Ghoststorywriter Reading Song of Kali by Dan Simmons
03 Nov 2013, 03:02 PM | Post: #27

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RE: Going Self-Employed As A Kindle Author

(05 Jul 2013 11:46 PM)jesrdesign Wrote: Wrote:  I'm a full time freelancer (graphic artist, not author) and there are a lot of great resources out there for people like us.  I took the jump to full time about 6 months ago and am happier and more financially free than I was before.
Before I took the plunge, I set myself a goal.  How much money will I need to earn each week to feel successful?  Once I figured that out, I found set out to find a several different sources of income.  Don't put your all your eggs in one basket!
Take up some freelance writing jobs.  Before you go all in, check out some freelance sites.  My favorite is Elance, and before I quit my job, I made sure I had a good reputation there by completing a few projects.  (Note: the hourly jobs arent worth it - work fixed rate if you go this rout).  I usually dont depend on Elance anymore, but I have an established 5 Star rating there, so I know if I'm not going to meet my goal by the end of the week, I can turn there for some income.
A lot of places hire freelance bloggers, SEO and content writers.  Check out forums like WAHM.com and workplacelikehome.com in the Telecommuting and writing forums to find some leads on writing jobs.  The people there are great at helping you figure out which jobs are worth it so you don't have to go through a lot of trial and error.  
It's so rewarding to work for yourself and be successful at something you're passionate about!  Best of luck.

Hi Jesrdesign

Many thanks for your advice. It was much appreciated. I will certainly check out those sites you mentioned, as I am desperately seeking some writing assignments to boost my income, which unfortunately, at the moment, is only being earned by the sales of my Kindle books on Amazon. I have been in business now for nearly six months with my Wirral Writer site, but have been finding it very difficult to get any writing work whatsoever. I am registered with sites like Simply Hired, Elance and similar sites, but it is very hard to get even a contact from a prospective client, as there seems to be far too much competition all bidding for same assignments. I can't even get a simple blogging job, and I LOVE blogging.
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Offline Ghoststorywriter Reading Song of Kali by Dan Simmons
03 Nov 2013, 03:08 PM | Post: #28

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RE: Going Self-Employed As A Kindle Author

To update you all on my self-employment status. Well, I started my writing business, Wirral Writer on the 1st June this year, but am STILL having a problem getting my Working Tax Credit. Since that HMRC officer in Blackpool Tax Compliance rejected my claim on the ridiculous grounds that my business was not yet earning the "minimum wage", I have had to fight and fight for my case to be dealt with. I have not only emailed the MP responsible for employment, but I have also had to make an appeal against that officer's decision. In regard to the progress of my appeal, I did finally receive word back from HMRC a few weeks ago, telling me that if I could send in further evidience of my business (e.g. invoices, breakdown of working hours etc.), the case may not have to go to appeal. This I have done, so am hoping that this will now be enough for them to award me WTC. Keeping my fingers crossed, anyway.
The other main problem I am having at present with my writing business is that even though I am earning a slow but steady income from sales of my Kindle books, I am not getting any writing assignments in order to top up my earnings. Even though I have registered on sites like Elance, Simply Hired etc., I can't even get one assignment, as there seems to be far much competition from other writers. Can anybody suggest what I can do to attract clients?
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Offline Scribbler Reading TBR list - I hate you!
03 Nov 2013, 03:24 PM | Post: #29

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RE: Going Self-Employed As A Kindle Author

Good luck with it, WirralWriter. Competition on those sites (and many others like them) is fierce, with everybody undercutting everybody else.
Offline Ghoststorywriter Reading Song of Kali by Dan Simmons
03 Nov 2013, 03:27 PM | Post: #30

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RE: Going Self-Employed As A Kindle Author

(03 Nov 2013 03:24 PM)Scribbler Wrote: Wrote:  Good luck with it, WirralWriter. Competition on those sites (and many others like them) is fierce, with everybody undercutting everybody else.

Cheers, Scribbler. Yes, competition is extremely fierce on those freelance sites. As I say, I have yet to find a single job there. One of the problems, I suppose, is that so many are computer savvy now and know how to write their own blogs, articles etc., thus obviating the need to employ an outsider. Still, I'll keep on trying until one day, somebody might need my digital content services.
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