Lost job mid way through the year, can I set up as self employed and offset my tax

happenstance

Hello,

I lost my job in October this year, now I'm setting up my own business where I'm working mostly from home and the income for the rest of the tax year will be small if any and most probably be at a loss.

Can I offset my losses as self employed with the taxes I have already paid as PAYE?

thanks

zygurat789

happenstance wrote: »

Hello,

I lost my job in October this year, now I'm setting up my own business where I'm working mostly from home and the income for the rest of the tax year will be small if any and most probably be at a loss.

Can I offset my losses as self employed with the taxes I have already paid as PAYE?

thanks

You need to be able to live AND to enable you to utilise your losses you need to convince HMRC that you may make a profit..

You always used to be able to send your P45 in with your notification of self employment and receive a full refund of all tax paid but I don't know if you still can.

Finally, when you complete your tax return, if you claim by ticking the right box you will be able to net off your salary with yiour self employed losses.

Funky_Bold_Ribena

happenstance wrote: »

Hello,

I lost my job in October this year, now I'm setting up my own business where I'm working mostly from home and the income for the rest of the tax year will be small if any and most probably be at a loss.

Can I offset my losses as self employed with the taxes I have already paid as PAYE?

thanks

You should get back any tax overpayment, and you will have to complete a Self Assessment and pay any additional taxes that you need to pay.

I have been employed in one job until last week, have a Ltd company and I pay myself through that and have to pay 20% tax on everything and have just landed some other paid sessional teaching; I keep a spreadsheet of all my Gross, net and tax paid and I calculate that I will have to pay an additional £300 at the end of the tax year. It's best to keep track and it avoids any additional surprises.

nomunnofun

happenstance wrote: »

Hello,

I lost my job in October this year, now I'm setting up my own business where I'm working mostly from home and the income for the rest of the tax year will be small if any and most probably be at a loss.

Can I offset my losses as self employed with the taxes I have already paid as PAYE?

thanks

Check your gross pay on your P45 though. If this is less than 9445 you will receive back all of the tax pais under PAYE. It would be pointlesss to claim any losses from Self-employment if that were the case.

happenstance

Thanks everyone for the advice. Total tax paid this year is 24, so expecting about 3 back.

I'm actually writing a book and need to purchase a new computer and mid range camera so that was another reason I was thinking about being self employed. Can I save the VAT on these purchases? Could I claim a small amount for the heating and that of my office to offset my tax?

Thanks

redpete

You can only claim VAT back if your business is registered to pay VAT.

You could claim a proportion of utility bills for working from home and something against wear and tear.