Self Employed Tax Return Advice

November 8, 2014, 7:12 am

This is my second year being self employed but first year as a full time self employed.

Crazy as it may seem, I quite enjoy the account side of things so I try to learn as much as possible but still some of it baffles me :mad:

Anyway I have filled in all my tax return and I have my final numbers but Im hoping for someone just to look at them

my total business income was roughly £16500

and my expenditure is coming up at £11900 :eek:

As I work from home, I have been claiming roughly 20% on rent/electric/gas/phone/internet

for my car I think I claimed 40% of total running costs ( <not sure if this is right)

I have put my long term purchases (equipment) into the capital allowances

I have also claimed train tickets for travelling to meetings
- postage
- stationary
- photography props
- any prints/canvas's/frames/albums etc.
- hotels for when im working away

Would someone be able to tell me if

A - if the final totals seem reasonable
B -Im on the right track with my claims???

Any guidance would be helpful and much appreciated.

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TAX REBATE e-mail ??

November 8, 2014, 2:03 pm

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Hi all,

Has anyone else had an email from HM Customs & Tax Office telling them that they have a rebate on the Income Tax they have paid?

I am thinking that it's "spam" or worse!!!

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Advice about setting up a trust (single person)

November 9, 2014, 1:53 am

≫ Next: 1st sole trader assessment

≪ Previous: TAX REBATE e-mail ??

Hi everyone,

Looking for some advice about my life finances with a long term view...i dont even know what i am wanting to do is legally possible....

I am a single male in my 30s, I own my house (partly mortgaged) and have a reasonable job. Reasonable amount of savings.... I am looking to place my house and/or a savings account into some sort of trust which can then be outside inheritance tax thresholds in years to come incase i was to die. I would like to be able to access the income generated from the savings as part of my declared income (to pay all due income tax etc). However, i would like to protect the assets as such to leave to extended family / any future family i have etc....So an ability to easily change the recipients as my future changes....
Also i dont have life insurance yet but if i did, i would like it to be under the same trust.

Is anything like this possible?

thanks in advance....

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1st sole trader assessment

November 9, 2014, 2:20 am

≫ Next: Tax Return - AIA question

≪ Previous: Advice about setting up a trust (single person)

Hi folks
Hopefully a very simple question and answer.
I registered as a sole trader in January this year, but remained in full employment (Tax and NI all on PAYE through my employer) until beginning of May. I dipped my toe in the self employed water by doing a bit of part time self employed work in my spare time between January and May, when I then took the plunge and went fully self employed. I only earned a few hundred quid at the part time stage. My question is that my 1st online self assessment is due in January, am I correct in thinking that I will only be declaring my additional part time earnings up to April 1st, and my main self employed earnings when I went full time from May will be done 2015-2016?
Thanks

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Tax Return - AIA question

November 9, 2014, 4:07 am

≫ Next: Worked half the year - taxed as if I worked the whole year?

≪ Previous: 1st sole trader assessment

Hi,

In principle is it OK to introduce previously owned equipment as AIA whenever it is appropriate? i.e. it's not obligatory to do it all in one go in the year when you started trading?

Thanks!

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Worked half the year - taxed as if I worked the whole year?

November 9, 2014, 9:15 am

≫ Next: IHT Gift Exemptions in Practice

≪ Previous: Tax Return - AIA question

Hello,

I've been looking today at some of old payslips from when I got my first job after I graduated in 2010, and I realised that I seemed to have been taxed as if I'd worked the full year -- I didn't work in my 3rd year of university until I graduated.

I worked in a minimum wage full-time job from September 2010 to March 2011, and then got another job March 2011 to December 2011 that had a slightly higher wage.

The P60 that I received for the end of the 2010/2011 tax year (5th April 2011) referenced only the 8 days I worked in the first two weeks of the job I got in March, as I had changed jobs right before the end of the tax year.

The P60 stated total pay as £462.00, total tax deduction as £92.40 -- yet as above I had worked from September 2010 in job previous to that one; If I look at the last payslip of that first job after university (September 2010 to March 2011), it states total pay £5,250.00 and total tax deducted £422.80.

Because I changed jobs literally just before the end of the tax year (the P60 detailing only 8 days work), does that explain why I've received no correspondence informing me of the tax I overpaid in that tax year (circa £500)?

In terms of claiming the tax back -- what details would I need?

Many thanks!

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IHT Gift Exemptions in Practice

November 10, 2014, 7:24 am

≫ Next: different tax codes but joint savings?

≪ Previous: Worked half the year - taxed as if I worked the whole year?

I think I understand (perhaps you'll prove me wrong) the basics of what counts as an exempt gift for IHT purposes. But I'm puzzled about the interpretation in a couple of cases.

Case 1: An executor of an estate has to report on gifts made in the 7 years before the death of the deceased, but can exclude gifts within the 'Small Gifts' and Annual Exemptions. To what extent can the executor assign gifts? For example, I gave a gift of £2000 to Mr A (and my 'Annual Exemption' for that year and the previous have been totally used elsewhere). Does this mean this gift of £2000 has to be reported? Or can the executor regard my wife and I as a single economic unit, and Mr and Mrs A as another single economic unit and split the gift into 3 gifts of £250 (one from me to Mrs A, one from my wife to Mrs A, one from me to Mr A) plus one gift of £1250 from my wife to Mr A, the latter of which would use any available Annual Exemption of my wife? Under what circumstances, if any, could the executor legitimately take this view?

Case 2: Interpretation of 'Normal Expenditure Out of Income'. If I deduct Outgoings (all except gifts) from Income and find I have, typically, £5000 pa surplus income (unfortunately this is hypothetical rather than factual) then can I gift £5000 pa as 'Normal Expenditure Out of Income' (providing it met the 'normal' condition)? Can all other gifts (eg to charity, 'small gifts', gifts within Annual Exemption, PETs) be regarded as being made from assets rather than from income? Can the HMRC insist that regular 'small gifts' or gifts to charity are regarded as 'Normal Expenditure Out of Income', thus reducing the amount available for other gifts? What, if any, purchases of assets have to be included as Outgoings? Presumably purchases, say, of shares, even if regular, are not classed as outgoings for this purpose. What about furniture, cars, houses?

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different tax codes but joint savings?

November 10, 2014, 7:43 am

≫ Next: Personal Allowance and Carried Forward Loss

≪ Previous: IHT Gift Exemptions in Practice

I don't know if this is the right place to ask so please redirect me to the best place! my husband and I have a joint savings account with redundancy money in and money from inheritance(money we have put aside for retirement as I do not have a pension.), I have not been working for a number of years now, my husband has worked apart from when he had an accident and was off work for some time and had to go on benefits. all this time tax has been paid on our interest earnt. we never really thought about the fact that we would have different tax codes over that time and probably should not have been paying all the tax, but no one ever asked at the bank! how do I get this sorted?
thanks for any advice.

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Personal Allowance and Carried Forward Loss

November 10, 2014, 3:06 pm

≫ Next: What tax to pay?

≪ Previous: different tax codes but joint savings?

Hi,

I am self employed. My profit for 2013/14 is £8,500 and I have carried forward losses of 12,500 which I could use to offset this amount.

Do I not use these losses though as my personal allowance is 10,000?

Or is there no personal allowance when carried forward losses are being used?

Thank you for any advice:)

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What tax to pay?

November 11, 2014, 4:05 am

≫ Next: Getting up to date with HMRC & Tax

≪ Previous: Personal Allowance and Carried Forward Loss

Hi all. I'm looking for some advice here please. Our parents come from other EU country and they live there. They plan to retire in 4 years and they would like to finance their retirement by property let. They are not residents in Uk, nor have the NI number. It'll be us managing the properties as we are residents here. It would be really helpful if we have some idea what will they have to pay in relation to government. They have their own pension schemes, none of them in Uk, they do not plan to live in Uk, they would just like to invest their money here. Many thanks for any ideas all.

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Getting up to date with HMRC & Tax

November 11, 2014, 11:19 am

≫ Next: HMRC calling card criminal investigation

≪ Previous: What tax to pay?

Hi MSE Forums, i'm hoping i can get some help here, i'm in a bit of a state and don't know what to do.
I first registered as self employed ten years ago, and along with my brother bought a house in 2006, self certifying. In late 2008 i suffered a nervous breakdown of sorts, had suicidal tendences, was diagnosed with clinical depression, and in the years since though i have worked - it's not really been sufficient to support myself.
Not through having expensive outgoings, but through low income levels. I am very fortunate in that i have a large and very helpful family, who have continued to support me emotionally and financially for the last 5 years.

The years have flown by, coasted on anti depressants and sleeping pills, but i am trying to snap myself out of it.

I'm currently trying to make the biggest effort i can to be active and get myself together, thinking that the more i can occupy myself the less chance there is for me to slip further into depression.

One of the things that has been left to slide and is now catching up with me is my HMRC tax situation. I basically have not filled tax returns since i had my breakdown, and as such now have lots to face up to.

I am gathering myself up to get in touch with HMRC, in order to find out what exactly i need to do, and how best to do it. I've not got the best records, but i think i will be ok. I have been able to login to the tax website and see that i must file returns for the last 5 years, and that some have been determined (figures such as £1000), along with interest and penalties.
So for some years it is £1500, others a few hundred. The thing is that i don't think that there has been a single time since 2008 that i have earned enough to bring myself over even the lowest threshold of £5000. Certainly in the last few years the level in creasing to 7500, on to 8000+ and now 10,000 i would be well under.

Is it the case that once HMRC say you owe £X because they've "determined" it that even if you can demonstrate what you earnt as being below the threshold - do you simply owe what they say? I worry as this year has not been good for me mentally, and i'm genuinely scared of failing at what feels like a last push to drag my head back to normality.

I know i can't owe the tax that's been determined, but it's the penalties on later years. Late filing. Daily penalty. 6month. It's thousands of pounds - i'm just not able to cope with living costs let alone a huge tax bill.

Sorry for such a long and rambling post. I don't know where else to go :(

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HMRC calling card criminal investigation

November 11, 2014, 1:06 pm

≫ Next: Claiming back tax for washing uniform?

≪ Previous: Getting up to date with HMRC & Tax

Has anyone had one of these cards? What do they investigate?

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Claiming back tax for washing uniform?

November 11, 2014, 3:10 pm

≫ Next: Switching bonuses taxable?

≪ Previous: HMRC calling card criminal investigation

Hello,

I am trying to claim back tax for washing hubbys work uniform, i understand i need to complete a P87 form, but what section do i complete it doesnt appear clear - well not to me???? :o

Thank you in advance of any help

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Switching bonuses taxable?

November 12, 2014, 12:15 am

≫ Next: Contacting HMRC

≪ Previous: Claiming back tax for washing uniform?

I've receive a few bonuses from banks for switching current accounts and filling out my self assessment and wondered if they were considered taxable? If so do you put them under interest received?

Thanks

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Contacting HMRC

November 12, 2014, 1:49 am

≫ Next: Self Assessment query

≪ Previous: Switching bonuses taxable?

At the moment I have a joint income of final salary pension and a salary from my present job and the two incomes combined takes me over the 40% tax threshold.

I will be leaving my job on March 31st next year. Would it be best to let HMRC know in advance so they can adjust the tax back to 20% as soon as possible after I leave?

is it too soon to do it now?

Thanks

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Self Assessment query

November 12, 2014, 4:04 am

≫ Next: partnership or sole trader?

≪ Previous: Contacting HMRC

After trying to call HMRC without success, I hope someone on here can help!

To cut a long story short, I submitted my Self Assessment Tax Return several months ago and then shortly afterwards paid the tax that I owe in full (which is due in January 2015).

However, when I log in online, my account is showing that I still owe the tax and that I have an overpaid the exact same amount and this amount is due as a repayment to me. For some reason HMRC have not taken this towards the amount I owe (even though they are the exact same figure).

I've tried to call them but after being on hold for almost 20 minutes I gave up!

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partnership or sole trader?

November 12, 2014, 4:41 am

≫ Next: Renting out parking space - tax advice

≪ Previous: Self Assessment query

I'm not sure where to post this but - I do free lance sign work for my self, I am also setting up a business for my partner. Would it be best put that business in his own name as a sole trader (he already has one sole trader business) or set up as a partnership? At the moment we both do self assessment as individuals. Would this make it complicated if we set up a partnership but still have our own sole traders? And tax wise - what is best?

I hope someone can help, and that this all makes sense! :-)

Thanks

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Renting out parking space - tax advice

November 12, 2014, 5:17 am

≫ Next: Child Benefit Confusion

≪ Previous: partnership or sole trader?

Hi all,

I'm planning on renting out my car parking space at the property I own with my partner. I understand that this is taxable and wanted some advice.

I'm currently paying tax at the higher rate (40%) whereas my partner is paying at the lower rate. Can I declare the income as 100% hers so that it is only taxed at the lower rate, or is it more complicated than that?

Thanks

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Child Benefit Confusion

November 12, 2014, 6:04 am

≫ Next: Selling unoccupied flat - 90% council tax

≪ Previous: Renting out parking space - tax advice

My partner and I live together but we are not married. We have two young children. We have received child benefit since our children were born (one in 2008 and the other 2010). I was unemployed when the child benefit rules changed, but my partner earned (and still do) just over £60k a year. This year in May I found a PT job and earn £15k a year.
I am confused over why my partner has not been sent a self assesment tax return form (or whatever they are called). Or am I still liable to receive the child benefit as I earn £15k/year and am unmarried?

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Selling unoccupied flat - 90% council tax

November 12, 2014, 9:15 am

≫ Next: Tax investigation stresses.

≪ Previous: Child Benefit Confusion

Hi Me and my ex partner are selling out house and flat. We both live in the house (Cambridge) and our flat (Bristol) is unoccupied whilst trying to sell.

We contacted Bristol council and they tell us we have to pay 90% of the tax, is this right?

If we lived in 1 property each then we would save 25% on each properties council tax. I assume saying we are doing that when we aren't is not allowed?

Just seems unfair that you have to pay more tax if no one is in the property than if there is someone there

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