Business didn’t get off the ground (tax?)

WorkFromHome · 10 November 2018 at 4:44PM

I started a business in September and set up with HMRC but it didn’t take off. I accumulated debt but receive no income so decided to quit it before things got worse. I set up as a sole trader and now wondering if I have to wait until April to do the self-assessment or if I can just cancel it? I didn’t earn anything so does it matter?

lss22 · 22 November 2018 at 8:34PM

You can submit your return any time as long as you've had the letter from HMRC asking you to send a return in.

It would be in your interests to do it, as if you've made a loss, you can offset that against your other income and reduce your tax liability.

Depending on the amount of the loss you've made, and your other income/tax liability, it might be worth speaking to an accountant for some advice.

00ec25 · 23 November 2018 at 2:59PM

if you had costs but no income be careful in case HMRC question whether the business actually was undertaken on commercial lines with a view to genuinely trading and making a profit. They are looking for people whose "business" is a cover for their own hobbies and the expenditure thereon.

can you evidence activity intended to produce clients, eg advertising, networking etc. The failure to get clients is not important, but the proof you tried to may matter.

Business didn’t get off the ground (tax?)

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