help,setting up my own buisness.

dazbo88 wrote: »

hello,im a plumber and currently paye.i have been for the last 15 years.
from april ive decided to finally go self employed.i will still be doing some work for my current firm,and i know they pay 20% tax from your invoice to them.i will also be taking on my own work,so i have a list of questions for you.
1 do i need an accountant and are their fees tax deductable,100 % or less.
2 i want to buy a van,i have £5000 to do this.ive been told it will not be 100% tax deductable,so what % will be.i do not want to lease a van yet.
3 is the van insurance,road tax 100% tax deductable.
4 is my public liability 100 % tax deductable.
5 i am registering with corgi,this costs in the region of £450 for the year and runs april to april.is this 100% tax deductable.
6 i have to buy out my gas registration from my employer.this is £1350 and i have signed a form to do this if i leave.it is common practice among plumbing firms in york,is it legal and is this 100% tax deductable.the £1350 is the cost of the exams and the wages paid to me while i was on them.
7 is the petrol 100 % tax deductable.
8 i want to work for firms and do private work as this will keep me below the vat threashold.should i register with vat any way.
9 i have always paid into a pension with the j.i.b. its a plumbing pension where i pay 3.5% of my wage and my employer has to pay 7%.can i keep paying this,is it tax deductable.
10 i assume tools,clothes etc are 100% tax deductable.
11 what national insurance do i pay.i think i will pay the 2% but do i have to pay 8% at the end of the tax year or is this optional.
and finally,can i buy the van,and other things before april and put it onto next years tax,as of course i will need these things before i start.
anyone with any info,thankyou in advance.cheers.

You are in the same boat as me.

All the insurance, fuel and general expenses are deductable.

Contract work will still be broadly the same as CIS was before, with your main contractor deducting 20%, although you will need your own PI insurance - which I take you already have, if not CORGI's is the best bet, I'm currently with NIG and unimpressed with daft limits such as not working on flats over 4 stories in height
.
The van, and powertools are regarded as capital assets, so you can claim 50% of their value in the first year of trading, then I believe it's 40%, 30%, 30% etc per year, it gets complicated when you add in new tools which have to be calculated separately until down to the 30% flat depreciation rate.

The van if say Feb for £5000, you get 50% of it's value - £2500 deduction in it's first year of ownership, divide that by 12 (£208.33 per month). So in that year 1 trading you claim for Feb and March (£416.66), next year you can claim 10 months @ £208.33, and then 2 months at 40% of the balance (40% of £2500 value = £1000 @ £83.33 per month)
If you keep the van for 1 year and it sells for more or less than £2500 you have to adjust the value on your books. Note you can't be seen to give the van to a mate for £200 as the tax people will wabt market rate. The only exception to this is if you have an accident or suffer mechanical failure making the vehicle worth less than market rate.

In general, if running a second hand van change it pays to change it every couple of years, to capitailise on the 50% depreciation, I have a 3 year old Traffic bought for £7400, with a £300 roof rack and £350 of signwriting, I'm claiming £3700 / 12 per month for the van, and 100% for the roof rack and signwriting in that tax year.

Clothes aren't claimable I've been told unless they are PPE such as steel tool cap boots.
If you have a boiler analyser, the calibration fees are claimable 100% but the analyser is a capital asset.

It's hard enough working in our environment without being an accountant as well?

Forget your employer's JIB pension contribution if you are a contractor, as you are on your own now.

Register with National insurance contributions it's about £25 per quarter, then when you do your SA it's (2007-08) 8% on earnings between £5225 - £34840 (from HMRC web site) 1% over that earnings.


Do not register for VAT unless you have to as it is more admin and time off the tools or the cost of paying someone to do it for you.

Generally speaking though, I think you are doing the right thing, get yourself some yellow pages online advertising as well as a £15 per week box in a local paper, also go door knocking and dropping cards around.

I now charge 47p a mile travel on private work, but I do travel a fair bit.

My advice is added some of the more specialist gas categories on your gas ticket as these pay the better rates.

Hope that's been some help.