Self employed expenses & profit

Connoisseurus_Rex

As I understand it, lenders are more strict with self employed applicants as they could in theory artificially increase their income through various means. 

The other half of the calculation for profit is expenses, presumably those could be minimised. Especially in the case where expenses are not necessarily the cost of doing business but more “claimed to be tax efficient” category. If you’re “choosing” what to class as an expense, is that a grey area or outright no-no?

MWT

So... have you always been misrepresenting your expenses to reduce taxation, or are you now misrepresenting them to inflate your income?

... it is a slippery slope when you start to change things to present a different version of the truth to suit a short term need...

Keep in mind that most lenders are not just going to look at one years accounts/tax returns, and changes like this can look rather obvious...

propertyhunter

Outright no-no. Imagine that cloud over your head if you did that - no one on this forum needs to tell you about the consequences. Just earn more by working more hours, or increasing your rates. 

Thrugelmir

One day you might be selected for review by the HMRC. Anomalies and inconsistancies are very apparent to an experienced eye. 

ACG

Its not really a grey area.

It is either a legitimate business expense or it isnt. I know what goes on the world, I would be pretty numb to think otherwise but ultimately your either committing tax evasion (by putting things through you should not be) or mortgage fraud (by not putting through things you should be).