1st ever self assesment...help please

noangel666

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Mary_Hartnell

I think we need a bit more information about the nature of your business and the time you spend doing it at home, before we can comment.
This accountant giving advice to a business trading as "tatfromtheloft" covers the basics quite well in a light hearted way.
http://cgi3.ebay.co.uk/ws/eBayISAPI.dll?ViewUserPage&userid=talkinpeace

It can be as complex as you want to make it but the time spent doing accounts may eat into the time you can spend doing what you are good at, and get well (?) paid for doing.
Your expenses have to be wholly & necessarily used for your business.
If you appear to stand out from similar traders you might get investigated and that will waste an awful lot of your time that could have been spent doing something productive.

fengirl_2

I think you will save yourself much grief at elast in the future if you set up a system where you retian all your reciopts for purchases and enter all your income and expenditure on a simple spreadsheet.
If you cannot justify a deduction for any particular expense, then be prepared to have those deductions added back should you be investigated by HMRC.

Mary_Hartnell

Quick after thought - if you appear to have converted part of your property to business use, by claiming for its running expenses, you may lay yourself open to future claims for business rates and then capital gains tax, when you sell the property.
You need to give the impression that you do your paperwork from a desk in the corner of the living room and thus incur a very modest allowance against the total costs of your home.

orangeslimes

noangel666 wrote: »

Hi all i work from home and have read up a bit about what i can write off for tax purposes.

1stly, with gas and electric.....i have 4 bed property, 1 living room and use living room as office. How much can i take off the bill for this please?

2ndly, I have Sky tv, phoneline and broadband. £22 tv package with £5 extra for BB and i use about £80 per month in calls and line rental. How much of that can i use please?

Also i have paperless bills so will i need to get that changed? and request a backdate of them?

I have kept no reciepts of my office supplys so where do i stand on that?


Thanks in advance

You need to think of how much a percentage of the property you use for business purposes. i.e. if half the time you make use of your living room is for business and your house has 5 rooms then 1/10 might be appropriate.
There is no hard and fast rule.
You can also include a similar portion of mortgage interest/rent and council tax.

Phone bills - You need to think how much you use you make for business purposes. i.e. are half your calls business related? how much is the internet used for business/how much for facebook etc? (and make sure you don't include any of what you paid for the TV)

There is no set in stone rule, but you need to be able to justify whatever you decide to HMRC in case they ever investigate you (if you are just using your living room as an office sometimes capital gains tax and business rates are unlikely to be an issue). You also should have documentation. It doesn't matter if you get paperless bills - but you should make sure you keep copies and if I was you I would print them out as they come and file them.

You need to start keeping receipts for office supplies and anything else in an organised way. For purchases you have already made, if you paid by card you could use that as evidence, but you should really have receipts.

Separate bank account is a good idea too.

dori2o

The other option to think about when using a room in the home as an office is the £3 per week allowance.

Although this is primarily from employees working from home, HMRC would still accept that £156 per year is a reasonable deduction.

Anything more than this and you really should have evidence of how you have come to the calculation.

Mary_Hartnell

orangeslimes wrote: »

Separate bank account is a good idea too.

Vital: if there is a suggestion that you have been mixing up the business income/expenses with your own private transactions - expect EVERY transaction in all your accounts to be a target for investigation.

The tax authorities have a technique of assuming the worst and then saying "You prove us wrong or pay up".

If you Google the subject you might find some "horror" stories - but they are written by the tax payer "victim".