Self-employed taxes and expenses in first year?

Jew

To those who replied: I get it, I appreciate you elaborating. I can imagine this means a lot to you.

However, as I said, I started this thread to get some opinions going. I perfectly well know that claiming an iPod I buy for my cousin will not count. But for working hours, apartment will be a viable expense. According to those examples from HMRC, I can claim something (unlike some here have suggested). I understand I won't be able to claim the whole thing because it'll be for both living and working.

In regards to why I'm still posting here: if it's possible to save money on an accountant and save 20% of viable expenses, why not?

Firefox1975

Ok,

Final bit of advice.

When you register with HMRC the address you will be using for your business premesis (50% of the time!<sigh>) it will be noted and be noticed as a "residential" premesis when they calculate your annual tax liability. (Now whether or not this is via a computer programme or "john" asking "mary" if she knows where 22b baker street is in london - is irrelevant).

This will lead to a quick scratch of the head and a small ? symbol next to the "trading" address.

sometime in the near future you will be sitting comfortably in your flat watching eastenders after you have packed all away your "work environment" gear, and there will be a knock at the door. (lets pretend he's old fashioned, and has a bowler hat on with a briefcase!)

He has come for a look at your business premesis and will decide there and then whether or not you are claiming correctly.

All of your arguments pointing him to websites and advice will be in vain i'm afraid.I do not beleive a one bedroomed flat that someone lives/sleeps in can ever, possibly, in the history of the universe, be classed as a business premises.

Please let me know what HMRC think.

NB - good luck with your work though, all of my comments on Tax aside, working for yourself is probably a very good decision.!

Jew

Hey thanks, some thoughts:

So you're saying that HMRC is an inconsistent organization? Saying one thing on their site, but enforcing another?

Also, why then are people, who have the privilege of owning a multi-bedroom house, allowed to deduct tax from a room they deem as an office — while I couldn't do the same for an apartment that would be an office at least 30% of the time (8 hour work day)?

Does not seem fair.

Instead of spending extra money renting an (unnecessary) office, I would work from home. If the office rent is tax deductible, why wouldn't my home office be also?

Thanks for trying to help, I appreciate it. I have a question - how are you so sure that HMRC would take the position you described? After all, it does not imply that on their own website.

jobbingmusician

I find your attitude irresistible - this thread has great comedy value. All that Firefox is saying is that HE doesn't believe that you can arrange a 1-bed or studio flat so that there is a clearly defined workspace which is not used as living quarters and which occupies 50% of the area. Neither do I.

Your stubbornness and unwillingness to accept or even listen to good advice will, I am sure, lead to an entertaining confrontation with HMRC. I look forward to hearing about it.

Pupnik

It is probably worth finding somewhere further out of London with enough space to have a mini office - not just for money saving reasons but for your sanity, could you really live and work in a studio flat? I think I'd go mad.

I know you don't want too long a commute but there are places you can move that are fairy easy to get to London from - where I live (for example) I pay £400 a month for a 2 bedroom flat and I'm less than an hour from central London by train, it boggles my mind that people will pay £400 a WEEK for a place in London when they don't really need to be there every day. The money you would save would make up for the (tax deductable) train fares. I don't know what kinds of clients you are going after but I would have thought being in the Thames valley with all the big business might be a good location - somewhere like Reading or Slough where you can be in London in half an hour and also have major global companies like Microsoft, Nestle and Pepsi on your doorstep. As I say though, I have no idea about what your business entails but I would be surprised the cost of being in central London is really worth it.

And as other people earlier have mentioned, HMRC are there to help - most of the time they write to me they are giving me back overpaid tax I didn't even know I had overpaid! It would be worth going on one of their free courses to get to grips with the basics.

persa

jobbingmusician wrote: »

I find your attitude irresistible - this thread has great comedy value. All that Firefox is saying is that HE doesn't believe that you can arrange a 1-bed or studio flat so that there is a clearly defined workspace which is not used as living quarters and which occupies 50% of the area. Neither do I.

Your stubbornness and unwillingness to accept or even listen to good advice will, I am sure, lead to an entertaining confrontation with HMRC. I look forward to hearing about it.

For anyone who can't be bothered reading this thread, it can be summed up as follows:

• The OP thinks HMRC are out to get everyone.
• The OP doesn't want to pay for any tax advice.
• If you offer the OP any advice, you must prove you are self employed before replying.
• If you offer the OP any advice that they don't like, you are wrong.

I'm out.

Jew

jobbingmusician wrote: »

I find your attitude irresistible - this thread has great comedy value. All that Firefox is saying is that HE doesn't believe that you can arrange a 1-bed or studio flat so that there is a clearly defined workspace which is not used as living quarters and which occupies 50% of the area. Neither do I.

Your stubbornness and unwillingness to accept or even listen to good advice will, I am sure, lead to an entertaining confrontation with HMRC. I look forward to hearing about it.

I find that your tone amounts to bullying.

persa wrote: »

For anyone who can't be bothered reading this thread, it can be summed up as follows:

• The OP thinks HMRC are out to get everyone.
• The OP doesn't want to pay for any tax advice.
• If you offer the OP any advice, you must prove you are self employed before replying.
• If you offer the OP any advice that they don't like, you are wrong.

I'm out.

Same with this.

I don't understand why you had to go through the trouble of attacking me like that. If you're not happy with where this thread is going, you have the option to ignore it.

I am not offending anyone here and simply trying to understand these issues better. Your accusations are crude assumptions.


If you want to help, then do so, but insulting me and making crass claims like that is completely off-topic and a form of cyber-bullying.

Jew

Pupnik wrote: »

It is probably worth finding somewhere further out of London with enough space to have a mini office - not just for money saving reasons but for your sanity, could you really live and work in a studio flat? I think I'd go mad.

I know you don't want too long a commute but there are places you can move that are fairy easy to get to London from - where I live (for example) I pay £400 a month for a 2 bedroom flat and I'm less than an hour from central London by train, it boggles my mind that people will pay £400 a WEEK for a place in London when they don't really need to be there every day. The money you would save would make up for the (tax deductable) train fares. I don't know what kinds of clients you are going after but I would have thought being in the Thames valley with all the big business might be a good location - somewhere like Reading or Slough where you can be in London in half an hour and also have major global companies like Microsoft, Nestle and Pepsi on your doorstep. As I say though, I have no idea about what your business entails but I would be surprised the cost of being in central London is really worth it.

And as other people earlier have mentioned, HMRC are there to help - most of the time they write to me they are giving me back overpaid tax I didn't even know I had overpaid! It would be worth going on one of their free courses to get to grips with the basics.

Thanks for the helpful response, I'll check out the courses!