How much extra income can you earn before being taxed?

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  • mamabuddah
    mamabuddah Posts: 826 Forumite
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    antrobus wrote: »
    A 'tiny allowance' for electricity costs?!?

    I'd start off by claiming at least £150 a year for Business Use of Home. What are you paying for broadband? I'd be claiming back 25% or 50% (maybe more) of that as well. Your computer is now a business asset, so at least a proportion of the cost of buying that asset can be deducted against profits. Etc, etc.

    That's why HMRC isn't really interested. It's not interested in getting 100,000 SA returns all showing £300 of income less £150 for Business Use of Home, £120 for Telecommunications, giving a net profit of £30 and £6 tax due.

    There are example allowances I believe shown on MSE for running a small business from home, room allocated as office, proportion of electricity, broadband etc, capital allowances for computer / printers etc...but just be careful about declaring you run an office/business from home...there are other implications, none of which are to do with tax returns.
    No two ways about this one: Anything Free is not a Basic Right..it had to be earned...by someone, somewhere
  • MoneySaver82
    MoneySaver82 Posts: 117 Forumite
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    antrobus wrote: »
    A 'tiny allowance' for electricity costs?!?

    I'd start off by claiming at least £150 a year for Business Use of Home. What are you paying for broadband? I'd be claiming back 25% or 50% (maybe more) of that as well. Your computer is now a business asset, so at least a proportion of the cost of buying that asset can be deducted against profits. Etc, etc.

    That's why HMRC isn't really interested. It's not interested in getting 100,000 SA returns all showing £300 of income less £150 for Business Use of Home, £120 for Telecommunications, giving a net profit of £30 and £6 tax due.

    I take your point that I could probably claim a bit more than I have been but don't really think from the HMRC guidance I can justify all the things you mention as I only use the room for a few hours each week to do surveys, etc - I think my situation would be more like Example 1 in this link - http://www.hmrc.gov.uk/manuals/bimmanual/BIM47825.htm
    So totally agree this would be a fair kind of amount to claim in my situation and thanks for making me thing about this a bit more as it looks fair and they say would be accepted without question - but to start deducting £270 from what I've earned doesn't seem to fit in with what they say is allowable and to be honest doesn't seem like an ethical thing to do, but maybe just me! :undecided

    Just think it's not really wise to suggest to people not to bother declaring their income because you feel HMRC won't be interested - I have a funny feeling they might be interested if they suddenly decided they can claim some penalties from you for not having declared your tax for several years!? :p
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