Doing tax return on line

katies_mum

Was hoping for a little advice please. I am self employed usually submit the paper tax return which is completed by my accountant. I am wanting to change over to doing this on-line and doing it myself as my business and turnover is small and want to save on accountants fee.

Can you advise me how I tell the Inland Revenue that I don`t want to do the paper tax return any more, will I have to let them know soon.

Also my accountant would usually work out a % for me using my car - will this be worked out for me on line or will it have to be worked out manually.

Many thanks for any help and advice you can give me.

PlutoinCapricorn

Welcome to the club! Filing online is much the best and easiest way, and the deadline for FY 2008/09 is January 31st 2010 not October 31st 2009 which is the paper deadline. And doing it yourself where possible is a good idea.

You will first need to register for online self-assesment:
http://www.hmrc.gov.uk/sa/file-online.htm

They will send you a PIN to use when logging on. It s best to register for online filing soon, and not wait until the last minute to file online, as the website can be very busy. No need to tell them that you will not be using the paper form, they will continue to send it with useful notes each year.

I don't know about cars, but someone else will help I am sure.

katies_mum

Thank you for the info and the link I`ve just got to be brave now and press the buttons to register. Is a scary thought as someone has filled out my return for me for the past 14 years (I do all the figures etc they just transfered the info over and put their name on the bottom of the return incase of queries).

I`m sure I have the figures for my car that were used last year so hopefully someone may be able to point me in the right direction based on these. I`m going to get all the paperwork out next week.

Thanks again

Possetjohn

Hi katies mum,

Filing online is not so difficult and you do not have to do it all in one go. You can stop and save it then log out. Next time you log in, you can restart from where you left off. You can also review everything for as long as you want (up to the 31/1/2010 deadline, but as Plutoincapricorn says, better to do it earlier) as the website gets very slow for the last two week in January. It only goes to HMRC when you press the submit button!

You can download the help sheets and forms from the HRMC website as PDF files if you want these in the future. My experience is once you register for online they stop sending you the forms and send you an e-mail reminder at the beginning of the tax year and a paper reminder later on.

Regarding the business use of a car there are two ways to do it. Either business mileage or total cost. If you have the same car as the previous tax year, then as far as I understand you need to continue in the same way until you change the car. You then have the option to do it in either way. You have to calculate the best way for you.

Mileage means you are allowed to claim 40p per mile up to 10,000 miles in the tax year, then 25p per mile for mileage over 10,000 miles. This is an expense i.e deducted from you business income to reduce your profit.

Total cost basis means you have to record all costs involved in running the vehicle. Fuel, servicing, road tax, insurance, capital allowance etc. You also need to record all mileage, both business and private. Then you subtract all the costs as a business expense and add back the private mileage/total mileage x Total cost as the proportion you have benefited for private use

suso

PlutoinCapricorn wrote: »

No need to tell them that you will not be using the paper form, they will continue to send it with useful notes each year.

not strictly correct. once you file online, they stop sending you paper returns and instead issue a "Notice to file" letter as soon as the tax year ends, as they presume that you will continue to file online. So it saves on stationary costs.

You can of course request a paper return with accompanying notes at anytime during the tax year, or download them from their website

Rolo_Tomasi

As you are talking about % use of the car then I assume that you are just adding up all of your expenditure. You then reduce this by 'private use' which can either be a set amount or a % of the total expenditure.

On the Tax Return you will have two options:

1. If your turnover is less than £30,000 you can complete the short version of the self employment pages which do not require you to categorise expenses. If you do this then you include the amount after the private use adjustment.
2. If you complete the Full version of the Self Employment pages then you include the total expense in the left hand column and the amount not allowable in the right hand column.

Hope this helps.

katies_mum

Thank you all so much for taking the time to reply to my questions.

With regards to my car I think I may have worded the question incorrectly, its working out the tax relief on the actual car! this is the bit I think may cause me problems.

I`m ok with adding up the motor expenses and then working out the % for the business.

Rolo_Tomasi

You are talking about capital allowances and you do have to calculate these manually. They are not just for your car, they are actually for all assets used in your business.

The starting point is to know what has been claimed previously and I think you will have to ask your accountant for this as it is not normally sent out.

You then usually claim 25% of the written down allowance but reduce this amount for any private use.

katies_mum

I`ve hopefully got the figures he worked on last year. You make it sound so easy.

Elaine_Wilson

Rolo_Tomasi wrote: »

You then usually claim 25% of the written down allowance but reduce this amount for any private use.

Don't forget the rate changed to 20% from April 2008.

katies_mum

Thanks didn`t know that, when I get to that bit.. and when I find last years figures please could I ask for help?

Thanks