I'm having an issue working out how I should be paying tax on Elance earnings, as I am considering going into this.

The situation is that I am based in the UK, but as Elance is an American site, often dealing with American companies/individuals, do I have any tax liability in the USA, personal or otherwise.

The second issue is that if I put the payments through someone elses paypal (what would actually be happening due to age requirements would be that my parents would be subcontracting the work to me) do they carry any income tax liability on that income?

I am trying to work out whether the best way to do this would be to incorporate a Ltd company, and put all business affairs through this. Obviously this would solve the taxation issue with regards to my parents, but I'd be paying £15 incorporation fees on top of the £15 a year in filing annual acounts.