3 q's re employd 2 Selfempyd & property net loss

custard82

I was late on my 2008-2009 tax return (1st rtn for me - late because couldn’t get technical officer to call back, & wouldn’t release UTR until then – long story, but a good defence & didn’t get fined). :T

Anyway, this means I’m trying to get ready for 2009-2010 return & get it in nice & early.

I have 3 questions, pls xcuse long post –all related, so diff to post separately & detail - 2 provide as much info as poss. - & so u can disregard if u' drather not spend ur time giving me free advice!

Tnx for reading & if any views,
custard82

1. As I moved from employed status on PAYE to self-employed, is there any chance I have paid too much tax, i.e. is 529L tax code right? I am guessing it is, but worth asking
· I was employed from Apr 09- Sep 31st 09:
ØTax code 529L
ØTotal Pay £18962.52
ØTax to date £3262.40
ØNI £1771.71
ØPension £948.09
2. How is income tax calculated for self employed, having moved from employed within the tax yr? I assume that my tax free allowance has already been allocated to my employed period, but that is prorata monthly? So could I have a little too much?
· I have been self employed from Nov 09-Apr 5th 10
Ø Total income £11041.81
ØEquipment £457.40 (laptop, office chair, keyboard, mouse, headset)
ØOther expenses £839.88
ØEst. Taxable income £9744.56
ØIs it just 20% of £9744.56?
3. How does loss on property income ‘work’ – particularly loss in 2 years - can i get a tax ‘rebate’ against other self employed taxable income?
· I jointly owned a rental property in 08/09 & 09/10 & made a loss both years
Ø 08/09 - £544.00
Ø 09/10 - £1199.13
· On my 08/09 tax return this listed in box 41 ‘Loss to carry forward to following year, including unused losses brought forward’.
· Since disposed of income but capital gains is below CGT threshold
· P.S not a total idiot, this was to prevent a relative in financial trouble being repossessed - we bought it & then did not complete until they had time to sort themselves out.

Tnx again for reading. Custard

fengirl_2

1. Absolutely cannot tell without knowing what the proportion of your profits were from the date you started s/e to 5 April10.
2. Your first accounts would normally be for the year to 31 Oct 2010, so you cannot know what your profits are yet. Your personal allowance is allocated across your income, you cannot choose.
3. The loss on income from property can only be carried forward to set against future profits from the same property, so it looks as if you have now lost them.

custard82

tnx to both re rental income - a shame, but never mind.

fengirl tnx again for replying to 1 of my posts. i am afraid i dont quite understand what you mean by what your prportion of profits are to apr10. showing my true ignorance here! sorry. Guessing you mean proportion for my financial yr Nov09-Oct10? I understand cant predict my financial year profits, but assuming HMRC just takes a view for each tax yr & adjusts up & down.FYI, I'm hoping to gross profit 28.8k apr-oct10. If contract extended appreciate would hit higher tax band for 10-11 tax year.

jimmo that really helps thankyou. I received benefit in kind for medical insurance for both 08-09 and 09-10 (until aug09),. I think I had 529L, to cover 08-09 BIK. For 09-10 this was 538.45, so assume I will need to pay 20% (107.69), so my tax to pay wil prob be1183.30+107.69?

Cheers
Custard.

fengirl_2

As your 2009-10 return is not due until 31 Jan 2011 you will not have to predict your profit for the y/e Oct 10 as that date will have passed. You preapre your accounts in the usual way and complete your 09-10 self assessment with the proportion of the profit relating to Nov 09 to 5/4/10. HMRC does not do any adjusting - you self assess and pay tax on the figures which you provide.

Pennywise

There's no need to prepare accounts for the first full year - unless you have good reasons otherwise, it would make your life a lot simpler to have the first period being up to 5 April 2010 and then do full years to 5 April thereafter. If you have a different business year end, you have to deal with opening & closing year basis periods and overlap relief which not only gets complicated, but could also leave you with a hefty tax bill when you cease trading as it tends to delay tax payments. As I said, there may be good reasons not to have a 5 April year end - an accountant would go through the pros and cons with you.

custard82

sorry for not replying yesterday - upto my eyes in plumbing. tnx to u both! I will do full years from 5 april on. Hopefully i will go back to employed status on paye in a year or so, so may only be two tax returns.