Pay tax on just profits?

paul1982

Hi guys, my first post on this excellent site and im wondering if anyone can help.
I have just started up a self employed business doing pc repair and i have a few tax questions.
I recently upgraded someones computer by adding 1GB extra memory.
The memory cost me £13.99 and i charged a total of £30 for the memory and fitting it.
Do i pay tax on just my profit (£16.01) or do i pay tax on the whole £30 then declare the £13.99 as expenses on my tax return?
Also, i already had quite a lot of second hard hardware which i sell to customers (as second hand), do i pay tax on this? as i already owned it.

Thanks

fengirl_2

You only pay tax on your profits, but your accounts will show your total turnover (takings) less your purchases and other expenses to arrive at your profit. Was the second hand hardware your personal property, or did you buy it in?

paul1982

right, i think i get it now.
The second hard items were mine before the business (left over parts from previous upgrades and items that have been given tome free of charge)

fengirl_2

Selling your own things is not taxable. Anything you have been given for use in the business is introduced at nil cost.

cosyc

I can recommemend a course run by HMRC aimed at new small businesses and all free of charge.
www.hmrc.gov.uk/bst
they tell the expenses you can claim for, you what records you need to keep, when you will get your first bill and how much to put away each week to cover it.