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Self Assessment Sole Trader Expenses

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Self Assessment Sole Trader Expenses

edited 30 November -1 at 12:00AM in Cutting Tax
8 replies 437 views
juicylucymjuicylucym Forumite
11 posts
edited 30 November -1 at 12:00AM in Cutting Tax
Hi my husband is a self employed courier driver and last year for the first time, had to start paying his own van rental, fuel, mobile phone etc. This came to £6k for the half year he worked.
We submitted this as part of his self-assessment tax return in June 2019 but all they have come back saying is he doesn't owe any tax as he earnt below his tax code and we paid £80 NI owed.
This is fine but what happens about the £6k expenses? Do we get these back as a tax return or are we not entitled to this for some reason?

Replies

  • Dazed_and_confusedDazed_and_confused Forumite
    6.5K posts
    Uniform Washer
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    HMRC don't pay expenses (unless you work them I suppose).

    They reduce your business turnover which can mean you pay less tax and Class 4 National Insurance. But if you didn't have sufficient income in the year to pay tax/Class 4 NIC in the first place they might in reality have little impact.

    Was the end result a business profit or loss?

    Did he have any other taxable income such as a PAYE job in the same tax year?
  • juicylucymjuicylucym Forumite
    11 posts
    Thank you, so where do we get this money back from? Or do we not get it back at all? The total profit was around the same amount as the expenses.
    No other taxable income but he was claiming ESA and PIP until then? Would that have had an impact on this?
  • Dazed_and_confusedDazed_and_confused Forumite
    6.5K posts
    Uniform Washer
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    You don't get it back from anyone. Why do you think you will get it back?

    If the result was basically no taxable profit then that's an end of it. If he made a loss then it might be possible to offset that against income in an earlier or future tax year however you would probably need an accountant to help you with that.

    Was the ESA received in 2018:19 taxable and if so did you include that on the Self Assessment return?
  • juicylucymjuicylucym Forumite
    11 posts
    No the ESA wasn't taxable, sounds like i'll need to find myself an accountant for this years!
    Thanks so much for your help!!
  • Dazed_and_confusedDazed_and_confused Forumite
    6.5K posts
    Uniform Washer
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    Try and find someone a friend/relative/colleague recommends.

    You may get an initial chat for free however before even getting to that stage you need to consider the possible benefits against potential outlay.

    If the business made a loss of say £500 then the maximum tax refund he is likely to get is either £100 or a reduced tax bill in a later tax year.

    There seems little point in paying an accountant £250 to get a £100 tax refund.
  • Important update! We have recently reviewed and updated our Forum Rules and FAQs. Please take the time to familiarise yourself with the latest version.
  • 00ec2500ec25
    9.1K posts
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    yes do get an accountant because you are clearly way beyond your depth and you have listed expenses that may not be wholly and exclusively business related.
    A concept I doubt you have come across, but one which could land him with a tax bill if you have got it wrong.
  • BoGoFBoGoF Forumite
    6.3K posts
    Part of the Furniture 1,000 Posts
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    Too many people listen to the guy down the pub who tells them "you get your tax back on you expenses"
  • robber2robber2 Forumite
    506 posts
    Part of the Furniture 100 Posts Name Dropper
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    Juicylucy,



    you should be able to save yourself at least some of the cost of employing an accountant by doing a little bit of your own research.



    This is as good a place to start as any;


    https://www.gov.uk/expenses-if-youre-self-employed


    good luck.
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