tax credits declaration form-please help!

someonehadmyusername

got to fill this in for when i started work (14.2.05) till 5.4.05(end tax year)

it wants to know my income form self-employment

but i havent made anything

well, i have, but all of it has gone back into business and buying new things/stock etc

i have a couple of hundred in bank which is for advertising on my car, new uniform and my £70 payment to princes trust this month

have i made a loss?

i think you only need to put in your profit dont u???

also, when will i need to tell them (if business picks up more and i make more money and stop buying so much stock) when i make more money

does it have to be if im gonna be making more than £2000 or something

im going on inland revenue taining course next week- cant wait (sad i kno)

really wanna get this form sent off

also, my partner got paid a bonus (one-off) last year when he wasnt living with me and also (not including the bonus) has made more money in tax year just gone (4-5) than tax year before (3-4)
will this ean we have been overpayed??
scared i will have been overpayed for one reason or another!
you hear about it all the time dont u?


please help me
xxx

irs101

I would wait until you have been on the course before filling in this form. You are right that you only have to declare the profit, but you need to know what counts as allowable costs (e.g. uniforms, electricity & phone bills if working from home) - just because you have paid for it out of your business account doesn't mean it's allowable (and vice versa if you've paid for it out of your "personal" money). When you come to fill in your Income Tax form and submit your 3-line accounts you will come up with a profit figure, and that is what you want to use for tax credits. There is no rush. You have until September to submit the form and even then you can still submit an estimate for SE income, with finalisation in January (in line with the time you have to do your income tax form).

However, you rightly point out that you have a chance of incuring an overpayment. Your 04-05 overpayment (if there is one) has happened and will have to be deducted from your future payments. The major issue is that your current payments are still based on the old income information. You could just let them carry on and be aware that you might be stacking up an overpayment (and put some money aside as appropriate) or you could work out a rough estimate of your income for the coming year (your bf's income plus your expected profit) and phone up HMRC straight away. Tell them you are not yet in a position to provide your actual income for last year, but that you want your current provisional award to be based on this revised figure. Obviously your expected profit is uncertain, but you could come up with a best guess and keep HMRC up to date as the year progresses and your profit becomes clearer. You only have to tell them about increases in income at the end of each year, but if you keep giving them up to date estimates, it reduces the chance of overpayment.

Hope that helps a bit.

irs

nedden

you put the profit that you declare in your tax return down as the amount that you earnt for claiming your tax credits.... if you made no money you put £0.00. As a new business the Inland Revenue (both for tax return and tax credits) will not be surprised that you have made nothing, however you need to inform them of this fact otherwise they will think you are being dodgy.

Get in touch with your local Inland Revenue advice centre (do not confuse this with the tax credits helpline) they are friendly and will put you straight about what you can claim against your business and how much you need to earn in net profit before you will pay tax.