September 21, 2019
  • September 21, 2019
mytery shopping paying tax calculation

Mystery Shopping Paying Tax UK

By on January 9, 2019 0 375 Views

One question that come sup time and time again when talking about becoming a mystery shopper is that of tax. Mystery shopping paying tax is a hot topic and one that we will look at today. There are some simple facts, and then some not-so-simple explanations that can go with this topic. So, let’s take a look together at mystery shopping paying tax and what it means to you.

Mystery Shopping Paying Tax

First things first, let me just confirm that this is solely based on UK tax laws as they stand at the start of 2019. I am not an accountant or lawyer, so you will need to make your own conformations here and ensure that you act in accordance with the necessary regulations. The HMRC is the best place to go if you have any questions. The HMRC process is confusing for most people, so here is a guide to make it easy for people to understand.

If you go out and mystery shop then 99 times out of 100 you are not employed. You are working as a contractor for the mystery shopping company. Some mystery shopping companies such as Market Force will make this really clear from the outset. Others will also remind you with every assignment you carry out.

mystery shopping paying tax in pounds

As a contractor, you are essentially self-employed. Let’s take a look at the rules here and what this means for you.

Mystery Shopping Paying Tax – Registration

You will need to register with the HMRC as a self-employed person. They will ask a few questions such as the nature of your business and from there you will get a UTR or Unique Taxpayer Reference. This will help you when you file a return at the end of the year.

Don’t worry as this is a simple process and one that will help you to stay on top of your self-employed mystery shopping business, because that’s essentially what this is. Mystery shopping paying tax starts here but there is a fair chance that you won’t have to pay a penny.

Mystery Shopping Paying Tax – Management

The key to all of this is to keep records. A basic mystery shop will pay you two elements –

  1. A reimbursement for what you have spent
  2. A fee for your time and costs

keep accurate records for mystery shopping paying tax

And when we start to look at it in more detail, this becomes clearer. Starting with the reimbursement. This will cover what you buy. So, if the assignment is to a coffee shop and they ask you to buy a coffee and a cake, this will be part of the reimbursement. And if you were not already going to that coffee shop then these are expenses that can be offset against the income. And that’s where the fee comes in…

The fee is for your time and expense. This comes in a number of forms –

  • Petrol, diesel or public transport costs for the travel
  • Any parking costs
  • The cost for printing out the report

And then there are linked costs for the internet, telephone and heat, light, etc in your home related to the business. This is where things can get a little complicated but you will usually find that the expenses in the bullet points above are enough when it comes to mystery shopping and not paying tax.

If the expenses balance the income then you haven’t made any money and can submit a zero return to the tax man. I will stress again that you should seek professional advice with this. I have the help of a bookkeeper with my mystery shopping and paying tax to make sure I’m in the right place with it all.

There’s so much to mystery shopping, so check out the book to find out more.