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More Tax Advice UK Needed ;) Sorry

Discussion in 'Business & Tax Advice' started by graphicnut, Oct 22, 2010.

  1. graphicnut

    graphicnut Supreme Member

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    Domains/ Hosting etc etc are they clased as Expenses?
    or are they something else? I'm never too sure, ive put them under "Materials Purchased" which comes under "less cost of sales" is this correct??

    Kind Regards hehe
     
  2. trevormorley

    trevormorley Junior Member

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    Definitely an allowable expense. If working from home claim for use of home as office, say £20 a week, it won't be quibbled
     
  3. graphicnut

    graphicnut Supreme Member

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    Does it come under Materials Purchased though?

    yeah i work from home, lets say my electric is £100 per month, what can i claim from that ? What's viable..
     
  4. Delboy2424

    Delboy2424 Regular Member

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    Domains should be capital expenditure, hosting wil be direct costs.

    In terms of working from home, ensure your insurance is aware as it can invalidate any home insurance claim.

    Apportion realistic costs for your venture# elec, broadband,phones,hosting,stationary - dont take the "P!ss" and you should be fine.

    In terms of materials purchased, it depends on how your chart of accounts are set up but in theory for your self assessment these are direct costs as they relate directly to what you are doing in your business - elec costs etc are overheads.

    Hope this helps.
     
  5. Cnotey

    Cnotey Power Member

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    Not sure how it works in the UK, but here in the US you can write off a percentage of your electric bill as long as you claim a home office.
     
  6. thesaintv12

    thesaintv12 Junior Member

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    Yes, I put it under 'cost of sales'

    Don't forget you can add every service etc you have purchased here on BHW and paid for via paypal etc. You can even claim the Paypal fees as 'cost of sales' if you have the time and patience to work it out.

    Sounds like you decided to declare in the end then? Bummer tax isn't it!
     
  7. oxonbeef

    oxonbeef BANNED BANNED

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    That's what I pay my accountant for.
    Not to do my books but to save me money.
    Good accountants are worth their weight in gold,
    anyone can use quicken or sage but they don't have
    loopholes programmed into them.

    PS, My accountant's Nigerian, I've used him for over 25 years and there isn't one loop or hole
    he doesn't know about.
    And of course his fees are a business expense.
     
    Last edited: Oct 22, 2010
  8. simey69

    simey69 Regular Member

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    Yes, it's a very real business expense.

    I base much of my accounts on the tax assessment form.
    Using the boxes you have to fill in - go to the hmrc site and download the current empty one if needed.

    For hosting and domains - i put them in the marketing and advertising costs.

    As long as you can give a reason for each expense you claim, it's valid.
    I've even claimed site membership as an expense - I was checking out their features provided to paying members and members profile security in comparison to one of my sites.

    As Delboy2424 said, just don't take the p!ss and you'll be fine.

    Si
     
  9. Didcot

    Didcot BANNED BANNED

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    You rent them both so I would have said fixed overheads.
     
  10. Delboy2424

    Delboy2424 Regular Member

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    in terms of UK self employment, any aspect of home working can be offset as a cost BUT you have to be prepared to prove it and sensibly apply a percentage that applies - you cannot offset every aspect of your utility bills against it (I have seen many try!!!) - rule of thumb for this area is normally treat it as a % of rooms in the house and you should be fine.

    Gas: Based on rooms in house
    Elec: Based on rooms in house
    Phone: all itemised calls for business use and normally 50/50 split between home and business for line rental
    Broadband: Normally get away with minimum 50/50 or 75/25 split - if you claim 100% you may be asked to prove you dont use it for personal use.
    Council Tax: Fair split as equivalent for business rates: Based on rooms in house
    Fixtures and Fittings: Providing you can prove the room is purely an office, you can claim full recovery of any reasonable costs with kitting it out ie. desks, chairs etc
     
  11. Delboy2424

    Delboy2424 Regular Member

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    Dont forget if you take capital allowance relief you can write these off as a small business rate relief in year one thus reducing your overall liability by 100% of the cost, if not just capitalise and apply depreciation as an allowable expense.
     
  12. Delboy2424

    Delboy2424 Regular Member

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    This is incorrect - if the self employment is internet based, then these are direct costs and not overheads as without them the business is not viable
     
  13. thesaintv12

    thesaintv12 Junior Member

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    Just another note. If you bought any equipment then you can add it in AIA (anual investment allowance) which means you don;t have to write off the value year after year.

    Motorbikes, scooters and mopeds can also be added as 'machines' now.
     
  14. Delboy2424

    Delboy2424 Regular Member

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    yep Saint - this is the right off allowance for capital expenditure, get yourself a new pc and write off at no cost in your first year ... ;)
     
  15. thesaintv12

    thesaintv12 Junior Member

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    You get a new AIA every year, so now you have an excuse to get a new laptop whenever you want ;)
     
  16. graphicnut

    graphicnut Supreme Member

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    AIA?? Im Uk remember...
    Ill do as best i can, ill just take a small % out for electric but i dont wanna over step it as its not classed an an "office" it's a computer in my living room so got to be careful.
     
  17. graphicnut

    graphicnut Supreme Member

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    im using kashflow.co.uk, really good
     
  18. thesaintv12

    thesaintv12 Junior Member

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    AIA (Anual Investment Allowance, google it) is for the UK. You can claim it as a Sole Trader on your Self Assesment return (paper or online). It is just a very simple way of claiming for any computers, printers, network kit etc you have bought over the year.
     
  19. thesaintv12

    thesaintv12 Junior Member

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    Cheers, I'll check that out. I am just using my own Excel workbook at the mo.
     
  20. graphicnut

    graphicnut Supreme Member

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    AIA, but i thought you can write off all your computer stuff etc etc so whats the diff?