Sole Trader - Expenses Help??!!

cakie777

Hi

My husband is a self-employed air-con fitter - sole trader. He has worked on a succession of contracts for the same company all based at Gatwick for the whole of the last tax year.

1. My understanding is that because his business is effectively home-based he can claim mileage expenses from home to site - but is this correct, if so, can he still claim if the site is the same for the whole year?

2. Do allowable expenses of £14,000 sound excessive on a turnover of £54,000 - or is this dependent on the type of trade in question?

Thanks in advance

golfwidow22

hi my husband is a self employed joiner,he has an accountant,and i have only ever known him allowed around £4000 in expenses for a similar amount to your husband is earning, for instance motoring, use of home,tools work wear etc, i dont know what your expenditure is but £14000 does sound quite high,if you dont have an accountant it might be an idea to speak to one,the cost of the accountant can be claimed against your husbands tax,we pay £300 for the accountant to prepare my husbands accounts and it is well worth it, just to know that they have been done correctly

Pennywise

Whether or not he can claim his travel, meals and accommodation as an expense in his accounts depends on where his "permanent workplace" is located as opposed to "temporary workplaces".

If he's only working in the Gatwick area, and not doing other work in other areas or around your home locality, then it's likely HMRC would contend that Gatwick was his "permanent workplace" and as such, none of his travel, meals and accommodation costs would be allowable at all.

However, if Gatwick is one of several locations where he works, including locally to your home, then all his costs will probably be accepted by HMRC as allowable deductions in his accounts.

You can compare it to someone who takes a job at the other end of the country - he can't claim any expenses to get there, but if he has a job in his home town, and they occasionally send him to other sites across the country, then he could claim travel etc as all the other sites would be "temporary workplaces". The rules are a lot less strict for the self employed, but it's certainly not open-season in just claiming home is the base and that all travel etc is allowable - there are still restrictions depending upon patterns of work etc.

In view of the £14k of expenses at stake, meaning several thousands of pounds in tax and NIC, it's well worth getting an accountant to make sure that you're claiming all you can.

PlutoinCapricorn

Don't forget https://www.businesslink.gov.uk - all advice is free.