Hobby business

[Burdekin]

Hi Guys,

I’m looking at setting up a small hobby business, to make a bit of cash to re-invest back into my workshop is the idea and to hopefully do some interesting work. The idea is it will be little jobs and I won’t be taking on any large jobs as I think there is a gap in the market up here. The range of services will be quite general but stuff I’m competent in:

Classic car work; repair panels, door repairs and reskins, weld repairs and epoxy priming etc.

• Machining; lathe, milling and drilling.
  
  
• Welding; mig, tig, brazing.
  

There’s a company in the shire who do Classic Car repairs who use to charge (not sure what he charges now) £30 plus vat/hr and his level of fabrication work isn’t as good as mine from what I’ve seen. I’m not trying to compete with him and I don’t want loads of work, one or two small jobs per week would do but not sure what I should charge. A mate was doing VW campers to a high standard and charging £20/hr. I was thinking about £25/hr plus materials, how does that sound? Also remember this is north east Scotland and not England where there’s no shortage of folk to take work to.

 

[rtbcomp]

One of the biggest factors determining a profitable rate is your overheads - e.g. if you rent a modern unit on a decent industrial estate your rate will have to be a lot higher than if you own your own premises.

The biggest problem with working from home is neighbours.

 

[cumbriasteve]

Anybody can work for nothing, they will be flooding to your door and what other's charge would not interest me, I would charge what I think I am worth.

However on the basis this is a little earner and not a survive on income £25 an hour may be ok, £40 an hour is better though, although if like me you will probably find they want a price for the job rather than pay you by the hour to sup your cuppa for 10 mins of it.

Also as rightly mentioned, ignore HMRC at your own peril, it's amazing how many people will be keen to share the information of your new found income to the tax man.

Consider also if you are working on a customers car and a disaster happens, for example you burn it out, can you afford the damages they will claim.

By all means go for it, I know someone not a million miles away who has made a lot of money in the past with 'under the radar' work, just be aware you can be caught out from a lot of directions.

 

[Burdekin]

Thanks guys. Some good points well made and stuff to ponder.

I just wasn't sure what sort of price to charge, hence asking on here.

The idea was that anything earned would go into the workshop set-up but maybe it's not worth the hassle. I'm pretty laid back but not everyone is like that I suppose and the public can sometimes be a pita.

 

[Burdekin]

I'm going to park this idea for now at least.

 

[cumbriasteve]

Don't kill the idea outright, just think a lot first.

It was a lot easier years ago to make some money on the side, today if anyone see's the bright light of a welding torch as they walk past they don't think 'oh that's pretty' they see £ notes for what they can claim from you burning their eyes out of their skull.

If you weld a car and a week later the electronics pack in, want to guess who is going to be blamed.

 

[Burdekin]

I won't kill the idea off. I have work to get on with at the workshop to get it where I want it and then a holiday so will see how things are going after then. It wasn't about making loads of cash, just the odd job to contribute to new toys for the workshop was the main idea.

 

[arther dailey]

Dont forget to dial in the hours you spend on tax returns, adding reciepts etc etc, I am self employed and I have one rule, the price is the price stated and everyone and I mean everyone gets a reciept and it goes through the books, well thats two ,ok! but it saves a lot of grief. I agree totally with whats been said above, insurance neighbours etc etc. keep it 100% above board and life is so much more straight forward . Arther

 

[CompoSimmonite]

Charge £25+ per hour and you'll struggle to convince anybody that it's just a hobby business Charge min wage plus materials and you might have a chance is only occasional work for others and then a few hours a week.
Use to come across it a lot where people thought they have found a perfect way of "earning a little money" without declaring.
Go legit from the start and save yourself a lot of heartache if you reckon you are worth £200 a day (8 hours at £25 per hour) as you will very soon get spotted by HMRC radar.



Paul H. (retired Revenue Officer for H M Inspector of Taxes !)

 

[Burdekin]

Paul, I have a company. Not sure why folk are assuming it wasn't going to be above board. There is a niche up here for what I was suggesting. I thought a few small interesting jobs would be fine for me and anything I made I'd use to buy more stuff for the workshop. In my head it was a win win but not sure it's worth bothering with after hearing what folk think of the idea.

I can make a lot more doing what I do as my day job so it was never about trying to make loads of cash.

 

[CompoSimmonite]

Paul, I have a company. Not sure why folk are assuming it wasn't going to be above board. There is a niche up here for what I was suggesting. I thought a few small interesting jobs would be fine for me and anything I made I'd use to buy more stuff for the workshop. In my head it was a win win but not sure it's worth bothering with after hearing what folk think of the idea.

I can make a lot more doing what I do as my day job so it was never about trying to make loads of cash.

Apologies.
Didn't know this would be an extension of an existing business. Normally people say "hobby business" and mean in addition to their normal full time job and that is what I , mistakenly, assumed.

 

[cumbriasteve]

In fairness:

Your post, like most others asking the same question, did give the impression to me and I am fairly sure the other's that it was your first venture into a self employed business of sorts.

No one suggested you intended to avoid HMRC, they and I were simply making sure you were aware of the full situation.

 

[Burdekin]

I’m not interested in arguing about anything on here. I was just asking about what would be a reasonable amount to charge, folk have assumed incorrectly which is easy enough and something that happens often on forums so no issue. Folks have came back with helpful comments which I appreciate and I realise this would be a pita to do for little reward so if a mod can just close this now it would be appreciated.

 

[cumbriasteve]

Locked at request of op