Self employed,expenses query

Dawning

2009-10 I was self employed but earned so little that I didn't bother to claim any expenses - I know,stupid but I didn't really understand how it worked and as I was well under the personal allowance it seemed a waste of time to add it on my return.
Just preparing return for 2010-11 and my gross profits are just over the personal allowance, coming in at £6680.
I work from home, can I claim £3 a week for heating and power? What about phone and broadband, I've never kept detailed records of how much time I spend emailing or on the phone etc, so I am worried that I don't know how much to claim, and also I can't prove it.
So how do I show this to HMRC, I file online and it just asks for amounts, how will I prove it to them - I do have utility bills of course but it's not as if they are itemised to show the amount of electricity used for working etc.

Any help much appreciated.

HappyMJ

You can claim £3 or if higher you could apportion the bill between home and business use and claim that instead. It may be higher. It doesn't need to be too accurate. The taxman isn't worried about small amounts. Just as long as you can prove it. i.e duel fuel £100 per month one third is used for business guessing at 8 hours a day out of 24 so claim £1 per day. £5 per week if you work 5 days per week. Or you can claim based on floor area there's a few different methods.

You'll need to apportion the phone rental and broadband. If you say 50% then use that. Get as many bills as possible and claim half of them all.

For such small amounts they don't want proof that's why it's called self assesment.

bobthedambuilder

For my past few years' accounts, my accountant has used a figure of £985 p.a. (i.e about £19 p.w.) to cover all expenses relating to the use of a home office (except telephone/broadband, which is entered at cost). I understand this to be a figure which is acceptable to the IR (or at least that branch which he deals with).

Dawning

Thanks very much both of you. I'm scared to death of the taxman - even though I only earn less than £7k a year :rotfl: . Just don't want to end up in prison for the sake of a few quid!

Thanks again, much appreciated.

Horace

The taxman isnt so bad and they are quite helpful at the HMRC on the self employment line.

I tend to keep all my receipts and even keep a little book in the car to note down my business mileage which I then claim at 40p a mile.

Maybe it is worth using an accountant because although they charge you, you can claim it as a professional fee and offset it against tax plus they will save you money.