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I am 13 years old and I live in the UK. I love coding and creating websites, so I thought I would turn it into a kind of business.

I am thinking of starting as a sole trader and doing bits of work for friends, family and so forth, until I get older.

  • Can I officially accept payment for freelance work?

  • If so, what taxes are involved?

  • Also, can I send invoices or is it better informally asking for each payment?

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5 Answers 5

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While there are general rules for child employment there is no minimum age for Sole Traders in the UK.

Tax rules are the same for everyone.

You will need some support from parents/ legal guardians with setting up bank accounts, signing contracts etc

There are a lot of online resources for this as well. See for example here.

It also helps to ask if someone in your family knows an accountant or other people that can support/guide you. Setting up a business, no matter how small, is usually challenging for adults as well.

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    The question doesn't mention platforms, but they definitely have their own age requirements. Upwork is minimum 18. If they find that are under-aged after verifying your identity, they'll immediately ban you and you'll lose your money.
    – Nelson
    Mar 13, 2023 at 5:03
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    Can you replace 'some help' with 'support from parents/ legal guardians'. If they are against it, there is not much OP can do.
    – quarague
    Mar 13, 2023 at 7:25
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You can accept payment for freelance work. You pay taxes like everyone else - which means you don't pay taxes on any taxable income below the personal allowance. That is currently about £10,000 so you probably aren't going to have to worry about it. However you have to file a tax return if you earn more than £1000 (see here for details). If you do get near to worrying about it, note that I said taxable income. If you have expenses (AWS fees, accountant's fees, hardware costs), you can deduct those from your gross income to obtain your taxable income. If you buy a £4,000 top-of-the-range gaming PC, you certainly can't deduct all of it, and you probably can't deduct all the proportion you are allowed in one year. Sorting the details of this is why you will start to pay accountants fees.

You should issue proper invoices and you need to decide whether you work on a time-and-materials basis (charging so much per hour), or quote a price for a job. The former is risky for your customer (if it turns out to be much more complex than you thought). Fixed price is risky for you; for big fixed price contracts, you will have to decide on terms (is everything paid at the end, or do you get some money when you have a first working demonstration?)

As others have noted, it is going to be dangerous for your customers as they essentially have no cover from the legal system if things go wrong. This means that big companies will not be interested. Individuals might be prepared to take the risk - particularly if they know you and your parents.

Do you have any customers in mind yet? Any freelancer needs a portfolio of work they can demonstrate. You may have to do some work for free in order to create that portfolio.

Good luck!

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    why can't you deduct the entire cost of essential hardware? While gaming explicit peripherals like joysticks/controllers might be hard to justify, with the advent of machine learning relying heavily on GPU compute, a £4k workstation is small fry compared to an NVidia ML Workstation
    – Djarid
    Mar 14, 2023 at 14:31
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    You can deduct the entire cost of essential hardware - but shiny lights inside the case don't qualify. (And you are right, graphics controllers are used for a lot more than getting high frame rates in Doom these days.) Mar 14, 2023 at 14:36
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    The issue of "danger" for customers is (IMHO) a matter of expectations. If you present yourself as a "full service" company, then sure, the customer is going to expect full legal protections and service levels (and quite probably a Limited company). If you present as "I'm 13, but I want to help", then you'll get customers who understand your school work comes first, and if something doesn't get done right, they either have to fix it themselves, or possibly pay you some more to fix it up. Mar 14, 2023 at 16:15
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General business tips:

  1. Your customers will want a business, not a kind-of-business, since they’re going to rely on you.
  2. You either send an invoice, or get the money upfront. (Typically, half up front, and half on completion.). Businesses would probably pay you out of their “petty cash drawer” (or the UK equivalent).
  3. You as a 13 year old web programmer can be just as much in business as kids who mow people’s lawns. (Or is that just a North American thing?). In the US, anyone who earns income must file taxes, no matter the age, though the IRS says that $600 is the minimum earnings for filing.
  4. It’s vital to keep track of your work orders, contracts, money earned and expenses. Get everything in writing, so that each of you knows what to expect of the other. (If this embarrasses you, frame it as you needing to keep track so that you don’t forget or overlook anything.)
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    @BestCoderBoy businesses are businesses, whether they be sole traders or corporations. (Limited liability companies are a form of corporation.)
    – RonJohn
    Mar 11, 2023 at 21:26
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    @RonJohn It appears that the OP is in the UK, where "limited company" and "sole trader" are well-defined terms.
    – littleadv
    Mar 11, 2023 at 21:33
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    Seems like the OP knows exactly what they're asking and your answer appears to be somewhat condescending. But that may be just me.
    – littleadv
    Mar 12, 2023 at 1:25
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    As the OP is in the UK, they don't need to file taxes unless their income exceeds the tax free limit (about £10,000) per year. When it gets near that, the OP should get an accountant, because there are significant expenses a sole trader can deduct from their income (including the cost of the accountant!) Mar 12, 2023 at 20:52
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    @MartinBonnersupportsMonica You have to register with HMRC and file a tax return if your revenue is more than £1,000, not £10,000. Though there won’t actually be any tax to pay until your revenue goes over £11,000 — or more if your allowable expenses are more than £1,000. gov.uk/set-up-sole-trader
    – Mike Scott
    Mar 13, 2023 at 16:55
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Your legal status as a minor presents problems.

Under 16 years is a not a barrier that completely prevents you doing this, but it's a line the authorities don't want you to cross and the barriers are more significant here. Note that it includes not interfering with normal schooling (and you don't get to decide what that means, the authorities do).

As I understand it (IANAL) a minor cannot be held to a contract - I cannot sue a minor if they fail to fulfill a contract or their negligence causes a problem (e.g. a security breach on a website). That would be a big problem for a business. And while it's hard to imagine the tax people prosecuting you as a 13 year old for not paying taxes, they could prosecute your parents (your legal guardians) as they are responsible for what you do. As a minor you cannot absolve them of responsibility, so they could be potentially liable for damages if that arose. It's a serious issue to consider.

If, for example, you knock over a piece of equipment in an office you are working in, a vindictive person might sue your parents. I'd be surprised if such a lawsuit succeeded, but it could still cost your parents a lot of money to deal with such a lawsuit (in fees to lawyers).

Issuing invoices (again IANAL) might be a problem because you're implying a contract exists or existed. That gets into complex legal issues with courts and the tax people.

Now if all you're doing is websites for friends and family that's unlikely to cause such problems. But note that, alas, in the adult world, friends do sometimes get nasty and sue their friends and in your case that would land on your legal guardians.

My advice would be to keep this on a family and friends basis. Keep email records of what people ask of you and make it clear in those emails that you are a minor. In any business never enter in a verbal agreement - that's how problems start. It's good practice for later life to get into that mindset early. At the same time be good to your verbal word, because reputation counts.

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    In the USA, a minor or their guardian can void a contract at any time, not sure how that is in the UK. They cannot modify the contract, just fulfil the contract or void it. If you enter into a contract with a minor, you will need to take that into account. For example, an NDA might be void if the contract is voided.
    – gnasher729
    Mar 12, 2023 at 18:44
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    As you indicate there are serious risks doing business with a minor. Note that in the UK a minor is anyone aged below 18 (your answer implies 16). Some contracts for minors are enforceable against the minor but they don't appear relevant to this situation.
    – Steve Kidd
    Mar 12, 2023 at 20:48
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    The suing is very, VERY, unlikely. Firstly the parents are not responsible for the child's carelessness unless they were negligent (that is much more likely to be the business). Secondly, although the UK is overly litigious, it is nothing like as bad as the US. Mar 12, 2023 at 20:56
  • @MartinBonnersupportsMonica As I said the issue is that suing just to cause trouble for the parents is a possibility (and people often sue for no better reason than to make trouble) . The fact that such a lawsuit is very unlikely to succeed would not mean it would not have the desired effect : financial and mental stress being caused. And I've lost track of how often I've seen lifelong friends and even family members suing each other to no possible benefit at all (except the lawyers, who get paid either way). The UK may not be as bad as the US, but let's not pretend it doesn't happen. Mar 12, 2023 at 22:05
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I thought a brief answer may be helpful here:

My question is whether I can officially accept payment for freelance work

It's 100% normal and commonplace for people of 13 to work and be paid.

(Think of say child actors at one end of the payment scale, and babysitters / car washers at the other end.)

You can and should start tomorrow.

and, if so, what taxes are involved.

You pay taxes exactly like anyone else. There is absolutely on difference.

Note that you will be "self-employed" - there are about four million self-employed people in the UK.

Obviously you will have to read a couple web pages on "how to be self-employed in the UK". But it's exactly the same for you or someone who's twenty.

(You are putting yourself HUGELY ahead of the curve by getting this stuff out of the way before you get older.)

PS don't forget all the computer gear you buy from now on is a business cost.

Also, can I send invoices or am I better informally asking for payment?

Invoices are really "1950-ish" particularly in software. Usually you just send an email these days.

If someone asks us for an "invoice" I just open Pages, type "Invoice: $x,000, date X, to company name". Then I save it as a PDF and email that. It's a non-issue. (Note that you DO NOT need a "letterhead" or anything silly. Completely plain white PDF page.)

  • Tip

Don't forget with software, web sites etc you ONLY get paid in advance.

If you don't have much experience you break it up in to pieces. Example, you're doing the corner shop's web page for £3000. You tell them "Great, it's £250 to do the basic design." They give you £250. You do that work (quickly). They approve etc. the front page. You tell them "Great, it's £1000 to get the site working on aws with your credit card integration". They give you the £1000. You do that work (quickly). And so on.

If they don't pay you in advance for the first step, even if just a small amount, you don't have a client, forget them and move on.

  • Tip

It's old fashioned, but click online (or walk to the corner stationery store) and spend £10 having business cards printed. Just have your name, number, email and "Web and Software Development". You'll be amazed how often you hand one out.

Like, you're Uncle Joe is saying "There's a good lad, making web sites are we! hi ho!" You can say, yes, please take one of my business cards.

It will make you feel solid and organized.

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    " Usually you just send an email these days." - well yeah. That email is an invoice. Mar 13, 2023 at 19:26

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