Parallel work - Managing additional source of small income

[myco]

I have been contacted by someone to possibly provide training on a certain niche skill for a fee on a few weekends. On weekdays I work for an IB.

- I was thinking about doing this as a business for the same limited that I do the contract for the bank for. Any problems there?

- How should I manage the fee - take cash and then deposit into my account (never done cash transactions myself before...but of course businesses do this all the time)? Or ask them to deposit into my account directly? Anything else I should be thinking about? If things don't work out, there could be partial refunds I'd need to do.

- I suppose I need to be charging an extra 20% VAT. The trainees will not be able to reclaim this since they are not businesses. Any better way to do this?

Any thoughts welcome.

Another question - training won't involve a "contract" of the kind IT development contractors usually have. Plus there might be multiple participants.

What is the equivalent of an IR35 friendly contract for this kind of work? Some kind of a cover-my-ass thing I get participants to sign?

And any tips on where one might be able to conduct such sessions (if there are just 2-3 participants / if there are more)?

[BolshieBastard]

I have been contacted by someone to possibly provide training on a certain niche skill for a fee on a few weekends. On weekdays I work for an IB.

- I was thinking about doing this as a business for the same limited that I do the contract for the bank for. Any problems there?

Your co can have as many different income streams as you wish. I used to run a retail business through my it contracting company at the same time.

- How should I manage the fee - take cash and then deposit into my account (never done cash transactions myself before...but of course businesses do this all the time)? Or ask them to deposit into my account directly? Anything else I should be thinking about? If things don't work out, there could be partial refunds I'd need to do.

Invoice them as you would any IT work. I wouldnt take cash as you may be tempted to use it rather than bank it \ keep proper records.

- I suppose I need to be charging an extra 20% VAT. The trainees will not be able to reclaim this since they are not businesses. Any better way to do this?

Any thoughts welcome.

You can only charge VAT if you are VAT registered. VAT has nothing to do with the trainees.

[NotAllThere]

- I was thinking about doing this as a business for the same limited that I do the contract for the bank for. Any problems there?
No.

- How should I manage the fee - take cash and then deposit into my account (never done cash transactions myself before...but of course businesses do this all the time)? Or ask them to deposit into my account directly? Anything else I should be thinking about? If things don't work out, there could be partial refunds I'd need to do.
However you prefer. Keep a clear audit trail, and remember it is your company's money.

- I suppose I need to be charging an extra 20% VAT. The trainees will not be able to reclaim this since they are not businesses. Any better way to do this?
No. If you're VAT registered, you must charge VAT

- Another question - training won't involve a "contract" of the kind IT development contractors usually have. Plus there might be multiple participants. What is the equivalent of an IR35 friendly contract for this kind of work? Some kind of a cover-my-ass thing I get participants to sign?
Are you doing this for a company or for a group of unconnected individual. In the first case just make sure your contract doesn't have the usual IR35 pointers, in the second IR35 isn't going to be an issue.

- And any tips on where one might be able to conduct such sessions (if there are just 2-3 participants / if there are more)?
Hotels have conference rooms.

[myco]

- I suppose I need to be charging an extra 20% VAT. The trainees will not be able to reclaim this since they are not businesses. Any better way to do this?
No. If you're VAT registered, you must charge VAT

If I register a new limited and I don't expect to go over the VAT threshold, then? The way I see it I would reduce cost for the trainees instead of paying HMRC more VAT. Any problems with this?

Yes, extra accounting costs might come up.

[BolshieBastard]

If I register a new limited and I don't expect to go over the VAT threshold, then? The way I see it I would reduce cost for the trainees instead of paying HMRC more VAT. Any problems with this?

Yes, extra accounting costs might come up.

So, you are going to set up another ltd company with all its associated costs ie set up, end of year accountancy costs etc, etc, for this potential income stream that may have very little income?

Riiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiight.

You are a sockie and I claim my prize

[Wanderer]

- How should I manage the fee - take cash and then deposit into my account (never done cash transactions myself before...but of course businesses do this all the time)?

Cash money?

Just pay it into your company account, it becomes part of your turnover and you pay tax on that. I'm sure that's how most cash businesses (cab drivers, market barrow boys etc) operate.

[d000hg]

Aren't your clients going to be businesses anyway, paying for their staff? In which case VAT is a non-issue.

[SueEllen]

Aren't your clients going to be businesses anyway, paying for their staff? In which case VAT is a non-issue.

And even if they are individuals they are aware that training providers who aren't universities/higher education colleges charge VAT so it's no biggie.

[TheFaQQer]

And even if they are individuals they are aware that training providers who aren't universities/higher education colleges charge VAT so it's no biggie.

Of course, the OP could just cut their charges by 20% for individuals if they are that fussed about it.