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Self employed income support - new business/training costs
Vegas2010
Posts: 22 Forumite
Hi,
I'm fairly confident the answer is no but just wanted to run things past to check.
My wife went full time in her business on 6th April 18, but kindly older employers paid 3 months notice on that date (first day of new tax year but paid end of April 18). If you look at 18/19 her self employed earnings are less than that employment income (c.48%). The self-employed profits are depressed as whilst doing PT work she was also taking a sports massage course at substantial cost which allowed her to expand offering in 19/20 tax year (c.£20k profit and tax return filed).
If you excluded those setup costs she'd be above 50% for the 18/19 tax year and therefore qualifying (likewise could remove allowances /some set up acquisition). I presume there is nothing in the guidance around removing exceptional one off costs when calculating self-employed profit as part of total income/profit from all sources?
As a follow up, she did some self-employed work in the previous tax years alongside employment although this was more hobby/testing waters so very small profits in year. Presume even if she could pass first test, this would still restrict any claim as the self-employed income for the two previous years would be taken into account despite only forming a tiny fraction of total income?
Seems a shame that 2 and a bit years into being self-employed full time that she doesn't qualify, but I guess you win some and lose some given we made the decision to go self-employed at the time knowing there wasn't a safety net.
Any help/confirmations would be great. Likewise say if you recommend trying to raise it with HMRC.
Cheers
I'm fairly confident the answer is no but just wanted to run things past to check.
My wife went full time in her business on 6th April 18, but kindly older employers paid 3 months notice on that date (first day of new tax year but paid end of April 18). If you look at 18/19 her self employed earnings are less than that employment income (c.48%). The self-employed profits are depressed as whilst doing PT work she was also taking a sports massage course at substantial cost which allowed her to expand offering in 19/20 tax year (c.£20k profit and tax return filed).
If you excluded those setup costs she'd be above 50% for the 18/19 tax year and therefore qualifying (likewise could remove allowances /some set up acquisition). I presume there is nothing in the guidance around removing exceptional one off costs when calculating self-employed profit as part of total income/profit from all sources?
As a follow up, she did some self-employed work in the previous tax years alongside employment although this was more hobby/testing waters so very small profits in year. Presume even if she could pass first test, this would still restrict any claim as the self-employed income for the two previous years would be taken into account despite only forming a tiny fraction of total income?
Seems a shame that 2 and a bit years into being self-employed full time that she doesn't qualify, but I guess you win some and lose some given we made the decision to go self-employed at the time knowing there wasn't a safety net.
Any help/confirmations would be great. Likewise say if you recommend trying to raise it with HMRC.
Cheers
0
Comments
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Re: previous years, any year where you earned less than 50% from self employment or didn't trade, are not taken into account. eg. 2017 £30k 2018 £0 2019 £30k = discount 2018 (not trading) average £30k. I would suggest you complete the application and if rejected request an appeal, although this could take some time for them to look at. Good luck0
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I am sorry but this is not correct, unless you didn't actually trade at all in the middle year, which would be extremely unusual.MarkJones4 said:Re: previous years, any year where you earned less than 50% from self employment or didn't trade, are not taken into account. eg. 2017 £30k 2018 £0 2019 £30k = discount 2018 (not trading) average £30k. I would suggest you complete the application and if rejected request an appeal, although this could take some time for them to look at. Good luck0
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