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  • FIRST POST
    • sprucegs
    • By sprucegs 5th Sep 17, 2:30 PM
    • 31Posts
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    sprucegs
    Doing my first self assessment tax return.
    • #1
    • 5th Sep 17, 2:30 PM
    Doing my first self assessment tax return. 5th Sep 17 at 2:30 PM
    Hello
    I'm about to do my first tax return for self employed. I have all my invoices together along with a print off spreadsheet showing all invoices added up together. I also have all my receipts I used in the year to purchase items. They are all together and again a spreadsheet printed off giving the total amount. My first year has been slow so I'm not going to be laying taxing but understand I still have to do it. I have heard people talk about OPEX and CAPEX? Please can someone explain what these are? I have bought things like a laptop, gloves, workwear, a few other bits and pieces I'm trying to figure out which goes where.
    Many thanks.
Page 1
    • Dazed and confused
    • By Dazed and confused 5th Sep 17, 5:10 PM
    • 1,705 Posts
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    Dazed and confused
    • #2
    • 5th Sep 17, 5:10 PM
    • #2
    • 5th Sep 17, 5:10 PM
    Did you have other taxable income, for example a previous employment, in the same tax year that you are doing your self assessment return for?

    This may make the importance of expenses more crucial.
    • sprucegs
    • By sprucegs 5th Sep 17, 5:25 PM
    • 31 Posts
    • 1 Thanks
    sprucegs
    • #3
    • 5th Sep 17, 5:25 PM
    • #3
    • 5th Sep 17, 5:25 PM
    Hi no. I got made redundant in the January 2016 and started my business in May 2016. Thanks
    • Sncjw
    • By Sncjw 5th Sep 17, 5:58 PM
    • 1,429 Posts
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    Sncjw
    • #4
    • 5th Sep 17, 5:58 PM
    • #4
    • 5th Sep 17, 5:58 PM
    If you go on gov website starting a business they list what items you can use as expenses
    • Wake up call
    • By Wake up call 5th Sep 17, 6:14 PM
    • 73 Posts
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    Wake up call
    • #5
    • 5th Sep 17, 6:14 PM
    • #5
    • 5th Sep 17, 6:14 PM
    Be wary of payments on account as in your first year it means paying 50% extra on your tax bill in advance.
    • Dazed and confused
    • By Dazed and confused 5th Sep 17, 6:20 PM
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    Dazed and confused
    • #6
    • 5th Sep 17, 6:20 PM
    • #6
    • 5th Sep 17, 6:20 PM
    Be wary of payments on account as in your first year it means paying 50% extra on your tax bill in advance

    That is just plain wrong

    Even if the op needs to make POA the first year they could apply for, assuming this is their first return, is 2017:18.

    And the first POA for 2017:18 isn't ever payable before 31:01:2018, three quarters of the way through that tax year. Hardly in advance.
    • Dazed and confused
    • By Dazed and confused 5th Sep 17, 6:29 PM
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    Dazed and confused
    • #7
    • 5th Sep 17, 6:29 PM
    • #7
    • 5th Sep 17, 6:29 PM
    I got made redundant in the January 2016 and started my business in May 2016. Thanks

    The importance of your expenses then primarily depends on whether your business turnover was more than the personal allowance, which was £11,000 for 2016:17. If not, and you aren't married then the expenses won't make any difference to the tax payable for 2016:17 which will be £0
    • jobbingmusician
    • By jobbingmusician 5th Sep 17, 9:04 PM
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    jobbingmusician
    • #8
    • 5th Sep 17, 9:04 PM
    • #8
    • 5th Sep 17, 9:04 PM
    AFAIK you can choose your own tax year. But it does make sense in every way except one to choose a tax year of 1 April to 30th March. The only way in which this is a bad idea is that the whole world are trying to submit their tax returns in January, so it is difficult to get help from HMRC then!

    I have been doing my own self-assessment for at least the last 10 years and had never heard the terms OPEX and CAPEX before but the form explains many of the allowances as you go along, in any case!

    You should have registered as self-employed within 3 months of starting, but my experience is that HMRC are reasonably kind about this as long as you tell them before they discover you. Once you register they will send you emails at regular intervals about online training which will help you with your returns
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    • sprucegs
    • By sprucegs 6th Sep 17, 3:23 PM
    • 31 Posts
    • 1 Thanks
    sprucegs
    • #9
    • 6th Sep 17, 3:23 PM
    • #9
    • 6th Sep 17, 3:23 PM
    I'm registered self employed and have received a form telling me I must do a tax return for the April 2016 to April 2017 tax year. It says I have until January 2018 to do this, but I don't want to leave it last minute. My income for that year was way below the personal allowance so I won't be paying tax anyway. I have invoices for the work I did in that year and have receipts all be it not many for things in purchased to help me. Things like a laptop, which I needed to buy to do my invoices etc, and other equipment such as workwear etc. I was just curious as to what this opex and capex actually means. All I need to do really I'm guessing is fill in my total income, my 'expenses' or things I bought to help me and that's it? I would pay for someone to do it, but the amount I earned it really doesn't make sense for me to spend money getting someone to do my self assessment for me.
    Thanks.
    • Sncjw
    • By Sncjw 6th Sep 17, 5:38 PM
    • 1,429 Posts
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    Sncjw
    There's a list what can be deducted as expenses on gov website
    • sprucegs
    • By sprucegs 6th Sep 17, 6:06 PM
    • 31 Posts
    • 1 Thanks
    sprucegs
    Thankyou ^ looks like it can all go into allowable expenses.

    On another note, I registered as a handyman. My business name is my first name initial and surname (e.g. D.Frank) I'm now concentrating on garden maintenance and have had leaflets made for D.F.garden Maintenance. Does this matter? All my invoices will still just have my name (D.Frank) on them.
    Thanks.
    • engineer amy
    • By engineer amy 7th Sep 17, 6:36 PM
    • 602 Posts
    • 1,105 Thanks
    engineer amy
    Thankyou ^ looks like it can all go into allowable expenses.

    On another note, I registered as a handyman. My business name is my first name initial and surname (e.g. D.Frank) I'm now concentrating on garden maintenance and have had leaflets made for D.F.garden Maintenance. Does this matter? All my invoices will still just have my name (D.Frank) on them.
    Thanks.
    Originally posted by sprucegs
    If you are not a limited company (only a sole trader) you can call yourself whatever you like, as long as you are not trying to "pass off" as another company. The slight difference in naming shouldn't cause an issue as it can still be tied back to the same entity - D Frank
    I would put a small footer on your invoices "D. Frank Trading As DF Garden Maintenance" just to avoid any doubt.


    OPEX and CAPEX are simply 2 different types of expenses. First is OPerating EXpenditure and covers the day to day expenses incurred in running the business such as leaflets, weedkiller, petrol for a lawnmower, anything really that could be classed as a consumable. Second is CAPital EXpenditure which is any asset expected to last more than a year such as a lawnmower, van or trailer for transporting equipment.
    I haven't seen these in an income self assessment context, but in a corporation tax calculation for a limited company, as they are treated in different ways and there are certain taxable allowances and writebacks for capital expenses.
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    • Pennywise
    • By Pennywise 7th Sep 17, 7:19 PM
    • 9,107 Posts
    • 16,518 Thanks
    Pennywise
    I got made redundant in the January 2016 and started my business in May 2016. Thanks

    The importance of your expenses then primarily depends on whether your business turnover was more than the personal allowance, which was £11,000 for 2016:17. If not, and you aren't married then the expenses won't make any difference to the tax payable for 2016:17 which will be £0
    Originally posted by Dazed and confused
    But there will be national insurance due on profits over about £6k, so it does matter re expenses as they may bring your profits under ~£6k and therefore mean you don't have NIC contributions to pay.
    • Pennywise
    • By Pennywise 7th Sep 17, 7:22 PM
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    Pennywise
    Things like a laptop, which I needed to buy to do my invoices etc, and other equipment such as workwear etc.
    Originally posted by sprucegs
    Re the laptop, if you also used it for personal/household use, then you have to apportion the cost - i.e. if you used it 50:50, you can only claim half.

    Re workwear, only protective clothing or logo'd uniform are allowable, so things like dayglo jackets or hard hats or steel boots, or a polo shirt with your logo embroidered. "normal" clothes such as suits, jeans, etc from "normal" shops aren't allowable even if you only ever use them for business.
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