Carers Allowance - self-employed capital allowances

seaweed

Hi, can't seem to find anywhere online that tells you whether you can deduct capital allowances/writing down allowance from your self-employed income in the same way as you can on your self assessment.
The CA website talks about claiming for eg. the cost of buying a computer used exclusively in the business. But what about buying a van used say 10% personal use?
Thanks 

whizzywoo

seaweed said:

Hi, can't seem to find anywhere online that tells you whether you can deduct capital allowances/writing down allowance from your self-employed income in the same way as you can on your self assessment.
The CA website talks about claiming for eg. the cost of buying a computer used exclusively in the business. But what about buying a van used say 10% personal use?
Thanks 

I used to claim Carer's Allowance whilst self employed a few years ago.

I used to send in my Profit and Loss Accounts together with a computation showing how my taxable profit was arrived at as follows:

 Net profit per the accounts:                           2,130
 Add back Depreciation shown in accounts:      957
                                                                       _____
                                                                       3,087

Less:  Annual Investment Allowance                     0
Less: Annual Allowance 18%                            388
                                                                       _____

Taxable Profit                                                 1,770
                                                                       =====

But in my case my yearly profits were very low, so even if the Capital Allowances weren't allowed I would still have been under the earnings threshold for Carer's Allowance.

When the Carer's Allowance dept ask you to declare your self employed income I would send them whatever accounts and Capital Allowances computation you used for HMRC when working out your taxable profit.

seaweed

Thank you wizzywoo! 

Bigwheels1111

when I was self employed 9 years ago and claimed carers allowance I provided them a copy of my self assessment.
The rules are strange, you can only earn so much from work, but I was renting out my house as needed to live with the person I cared for.
The rent was excluded as House was purchased as a home not for rental.

seaweed

Thanks Bigwheels. Yes, it's a strange system, they should be more transparent about the income rules.
Also unfair that when you reach pension age, CA stops. It seems you can't be a pensioner and care for someone at the same time (or at least don't expect the state to help you do so) 🙁

whizzywoo

seaweed said:

Thanks Bigwheels. Yes, it's a strange system, they should be more transparent about the income rules.
Also unfair that when you reach pension age, CA stops. It seems you can't be a pensioner and care for someone at the same time (or at least don't expect the state to help you do so) 🙁

Are you claiming any means tested benefits?  Having an Underlying Entitlement to Carer's Allowance can mean that the threshold for claiming these benefits is higher.  A Carer's Element can be added which is different to Carer's Allowance.  It can mean more Universal Credit or Pension Credit if applicable.

nannytone_2

It has nothing to do with pensioners caring for someone else or not.
Xarers allowance is ac income replacement benefit, paid to reflect yjat carers are unable to work more hours due to caring responsibilities (given the rate if CA as a work replacement is laughable).
Pensioners receive the state pension, which is also a work replacement benefit, so both cannot be paid together.
Ot also applies ti ESA.
A carers premium can be claimed though if received ING means tested benefit

poppy12345

seaweed said:

Also unfair that when you reach pension age, CA stops. It seems you can't be a pensioner and care for someone at the same time (or at least don't expect the state to help you do so) 🙁

How is it unfair to pensioners? The same rules apply to anyone that claims a means tested benefit like Income Related ESA/JSA and Income Support. Its deducted in full from their benefits, they then add a carers premium of £38.85/week. Therefore they are just £38.85/week better off.

seaweed

whizzywoo said:

seaweed said:

Thanks Bigwheels. Yes, it's a strange system, they should be more transparent about the income rules.
Also unfair that when you reach pension age, CA stops. It seems you can't be a pensioner and care for someone at the same time (or at least don't expect the state to help you do so) 🙁

Are you claiming any means tested benefits?  Having an Underlying Entitlement to Carer's Allowance can mean that the threshold for claiming these benefits is higher.  A Carer's Element can be added which is different to Carer's Allowance.  It can mean more Universal Credit or Pension Credit if applicable.

Thanks for the info, no means tested benefits atm. And I'm still a few years off pension age, just looking ahead!

calcotti

seaweed said:

It seems you can't be a pensioner and care for someone at the same time (or at least don't expect the state to help you do so) 

That isn't what the rules mean. Both CA and SP are income replacement benefits awarded in recognition of a limitation on your availability for work. In the case of CA your availability for work is taken as reduced by being a carer. For SP you are not expected to work anyway. No one is saying you can't be pension age and a carer just that you can't get both benefits. If you are a pensioner and are a carer applying for CA will establish an 'underlying entitlement' which will increase possible entitlement to means tested benefits such as Pension Credit, Housing Benefit and Council Tax Reduction (or UC if you are in a 'mixed age' couple)

ladylugton

If you are running a "business" (maybe need to show caring for more than one person) as sole trader / self employed ie you are preparing some sort of "accounts" ie calculating your income and expenses, claiming capital allowances should be claimable with a proportion deducted in line with the amount of personal use, on a 'fair and reasonable" basis.  

One point is if you are using the "cash basis" to calculate your income and expenses, as opposed to traditional accounting, capital allowances may not be allowed. Have a search for "cash basis" on HMRC.  "Simplified expenses" may also be an alternative way.  

Also you will need to be able to justify why a van is an expense for your business, as with all expenses, should HMRC challenge them.