Self-employed newbie needing advice

Oldblue_2

Hi,

I'm starting a new job as a self employed insurance agent at the end of the month. I will be going into partnership with a senior partner with a commission split of roughly 60-40(Not in my favour!). I have never been self employed before and have no idea what I am doing with regards to tax etc...

I need to buy a car very soon as my job wil involve a lot of driving. I've heard people use terms like "writing of your car to tax" but I have no idea what exactly this means. I'm looking at leasing or using finance to buy my car but was wondering what is the best way to do it with regards to tax. I've had brief discussions with my partner about the possibility of paying for the cars through the business and I've also been told elsewhere that I would be better claiming 40p per mile back through the business. I also don't know if we pay for the cars through the business, will I be worse off because of my lesser split in the commission?

Can anyone tell me what I am entited to claim, and what is the best way to do it.

Any help would be much appreciated!!!

fengirl_2

Your motoring expenses have to be included in the partnerhip accounts one way or the other. There are two ways of charging this:
1. BY including all the costs of running the car, whether leased or not, including petrol, MOT, insurance, etc and then adding back in your tax return the privtae element. So, if you used your car 75% for business, you would add back the 25% private use. You would also claim capital allowances if the car was your own (rather than leased) on your tax return.
2. You include in your accounts 40p pm for the first 10000 miles travelled on business and 25p thereafter. You cannot include any other motoring costs if you choose this method and that includes capital allowances.
I think to see which method is most beneficial, you need to keep records under both methods for, say, 6 mths and then decide what to include in your accounts. Once you choose one method, you have to stick to it.

funandfrugal

Though I would suggest you find a good Accountant - see a few - first consultations should be free. A reccomendation is priceless.
Also your local business link will be a great source of information and advice. Use everyone there to help you, not only will you become more knowledgable but will meet potential contacts.

Good Luck in your new venture

Trace
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