Self employed tax refund

bartman100

I started self employed on the 17th Oct 2017 and want my accounts to run from April to April
I have earned £14000 in this time and spent £7000 setting up my business, website, materials, van etc
Of that £14000 I paid CIS at 20%
Might be silly question but should I expect all my materials, diesel, website and anything to do with my business back from HMRC?

I have got an accountant but I have never been in this situation and looking for second opinion but they say my refund is £2600? Before I question them are they roughly correct?

Pennywise

You can only claim tax relief on your expenses, not the expenses themselves. So if you've paid tax at 20%, you get tax relief at 20% on your allowable expenses, i.e. spend £7,000, tax relief on that £7,000 is £1,400 (20%). There's also national insurance relief on the same basis. So, no, HMRC don't give you the money back of the amount you spend on expenses.

00ec25

bartman100 wrote: »

I have got an accountant but I have never been in this situation and looking for second opinion but they say my refund is £2600? Before I question them are they roughly correct?

yes, they are probably correct

£14,000 "income" - is that before or after the 20% CIS deduction?
what tax year are you asking about?

based on your vagueness....
14,000 - 7,000 = 7,000 taxable profit
tax paid to date 14,000 @ 20% = £2,800

actual tax due:
7,000 profit - tax free personal allowance 11,500 (17/18 tax yr) =£0
tax to be paid £0
tax already paid £2,800
tax to be refunded £2,800

tax refund according to the accountants: £2,600
"missing" £200: no idea, put it down to vagueness.... (or a much more precise understanding of your actual figures, including what you can and cannot claim as expenses to arrive at your taxable profit)