Paying tax in UK on Adsense revenue

[dayo]

I know this subject has been done to death but I am finding it hard to get an answer to my particular situation.

I am currently in full time employment in the UK, I have a personal website that has adsense on it that generates approx £60 per month, although for the tax year 2013 - 2014 it generated approx £1700, I am paid by Google Ireland ... Do I have to contact the HMRC and pay income tax on this additional revenue?

I appreciate any help you can give :-)

[graeme_p]

Yes.

[RedBar]

Unfortunately yes, if you were self-employed it would simply be lumped in with your earnings.

[piatkow]

Defnintely, but HMRC may get very confused when you try and claim valid expenses against the self employed element.

[engine]

Every penny of your additional income ought to be declared, and you're very likely to have to pay tax on it.

Assuming you're a basic rate tax payer, you should put aside approximately 20% of your income for tax.

[nomis5]

Yes you pay tax on the full earnings. The tax form has a separate secton for self employed earnings. It has never given me a problem. I do check their calculations carefully though.
You can also claim expenses such as hosting costs etc. But if your full time earnings are in excess of your self employment earnings think very carefully about claiming expenses against electric, gas etc. And be exceptionally careful about claiming use of part of the house as an expense. It can have serious implications when you come to sell.
Also, you need to declare yourself as partly self employed to the tax man as soon as possible, well before you submit a tax form. There is form / procedure for that. Look it up on the HMRC website asap.

The fact that g is based in ireland will become relevant if your self employed earnings hit the VAT threshold but you are a long way from that at the moment.

[netmeg]

Assuming you're a basic rate tax payer, you should put aside approximately 20% of your income for tax.

This is a good point. I'm not in the UK, but I automatically stick 15% of *any* income into a savings account I set up for just for keeping the tax money. AdSense, affiliate, consulting income, everything. My accountant says that's overkill, but at least all my surprises are pleasant ones (at least in the tax area).

[engine]

Exactly, Netmeg. You will have to pay tax as there are very few exemptions.
I know there's not much interest on savings these days, but you may get something back. Tax is usually paid by specific dates, so you could put the money away into longer term savings, as long as you know the terms of withdrawal. Don't get caught out with three months notice.

[nomis5]

I think 15% will not be enough for the OP. If you are paying tax on your main income then in all liklihood the lowest you will pay on additional income is 20% and possibly more. On top of that comes increased NI payments.
If you are on higher rate tax then 40% is a real possibility in the UK.

[netmeg]

Actually, I misspoke. I sock away a full third every time I get a check, even if it's a tiny one.

[jonii]

Hi everyone.

I'm from Argentina and I've got a EU bank account thanks to Payoneer. I'll receive Adsense UK earnings there.

Do I have to pay taxes? In case yes, how?

[nomis5]

I sock away a full third every time I get a check

That sounds about right, same as me.

[jonii]

Where are you from @Nomis5?

[graeme_p]

jonii, you usually pay tax on earned income where you live, so ask a local expert first.

[piatkow]

@jonii - the HMRC website [hmrc.gov.uk] has details of the rules regarding UK earnings by non residents.

[IanCP]

There is only ONE definitive answer:

Go and see a tax expert at your place of residence - where you pay your income tax.

Don't EVER rely upon other people's anecdotal stories.

[jonii]

Thanks @graeme_p, @piatkow and @IanCP for your replies.

I'll see a tax expert here where I live.

The HMRC website says that I have to pay taxes to UK government (basically says: "If you are a human, you have to pay). But I think is more logical pay taxes here on country.

[graeme_p]

Where does it say that? The piatkow's link says you are taxed on work done in the the UK. Did you find anything else?

If you are not visiting the UK to work you are probably OK. You local tax expert should know or be able to find out, and will know about the terms of the double taxation agreement (assuming there is one) which is also important.

[jonii]

Yes, you are right. I'll ask him again.

Thanks again @graeme_p.

[engine]

The only certainties: Death and Taxes. You cannot yet avoid the former, but many decide to avoid the latter. Do so at your own peril as the penalties can be severe.