Clean It Up
UK Window Cleaning Forum => Window Cleaning Forum => Topic started by: Feen on October 06, 2007, 06:06:01 pm
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There's the obvious stuff like fuel, equipment purchases etc etc, but what else to you claim? I consider these to be legit. Mobile phone. Stationary. All equipment. Fuel. A room in my house for office use. There may be more. What about paying my wife say £50 a week for bookwork? Ideas and opinions, folks?
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Too right mate.
All of the above and whatever else you can think of.
They rip us off, get your revenge. >:(
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I think the criteria(that they give) is fair and reasonable. If you put down something that sticks out expect to get looked at.
We have enought legitimate expenses without having to invent things.
The best advice is to try and run your business really well, forget about trying to fiddle.
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VG, I'm not trying to fiddle, although I may have given that impression. I'm just trying legitimately reduce may tax bill. I am asking if there are expenses I should claim, that I'm not.
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Feen
You can do a lot worse than ask an accountant - mine charges a tiny sum when you consider all the work he does for me. Last years bookeeping, accounts, and tax return was all done for me for less than £200. He claims for all sorts of teeny little things that i would never have thought of. It is always said taht an accountant will save you far more in tax than it will cost you to employ one. This has proved correct in my case.
Do bear in mind that in you claim money for work your wife has done she will have to declare this too. Speaking to an accountant is the way to go IMO.
Stephen
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Thanks, Stephen
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Sorry Feen,
Bookeeping is one of my interests, even though i don't know much about it. The best thing you can do is not rely on an accountant. But to do this you have to learn.
Bin the accountant, go on a course.
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VG, I'm interstested in why you say "bin the accountant". The previous poster, Stephen, clearly feels they are worth while. I do have an accountant and will be speaking to him soon. He has clients from all walks of life. I am just interested in peoples' opinions specifically from a window cleaning point of view.
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I'd agree with Stephen speak to an accountant.
Spend your time developing your business. WC is what you specialise in.
The same as accountants are specialists in saving you money and making sure you get all the benefits that your entitled to.
I think VG meant book keeping?
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Well, i speak as i find.
Funnily enough the guy who reccomended my accountant to me is self-employed himself (he is a wardrobe fitter) but does all his own books and accounts. He was fitting wardrobes at a house i was cleaning when i first set up my business and we got chatting. He was telling me that he does all his own accounts as he has the expertise, the knowledge, and the time to do it. But even he said that i should find an accountant if it was that i was really as blind to accounts as i said i was.
With that he then told me about this accountant who he'd fitted wardrobes for and since then i've used this accountant to do all my paperwork (more or less). All i have to do is record in an exercise book how much money i have taken each week and also how much i have spent. Thats all i do with my 'book. When i take my book to him (usually once a year) i take all my bank statements, fone bills, tax return, and then 3 months later i get it all back with a bill for his services. A tax bill follows in due course but for the first 3 years of my accounts this has been -literally- minimal.
He said his job is to make sure i dont pay a penny more in tax than i should do. It is just like Art said, we are 'experts' in what we do and it is better to concentrate on what we do best IF we dont have the time and confidence and/or understanding to do other parts of our business. I am not a stupid or thick person but having this doen for me is the best £200 i spend in a year.
Although they are 'our' accounts, an accountant is the one who is chiefly in the poo if it all goes wrong (though of course you are still liable to pay the difference in a tax bill if the accountant makes an error AFAIK)./ I am not knocking those who go it alone with the old accounts, but its just not for me and i am not a beliver in speculation and assumption etc so i chose to pay someone who is (supposedly ;) ) in the know.
All i can say is it works for me.
Stephen
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Have you ever been outside a hairdressers when the lady comes out over the moon with how she looks? Then the next and the next, except that they all have exactly the same hairstyle, which in turn looks exactly like the stylists.
Put it another way, is it best to accept a web template for your site or better to try to create your own?
Be your own financial director.
New Van next year? £1000 pole to service work you might not get?
Being on top of your books is the same to me as running a good business. Not all accountants understand our business.
Just read Stephens post. That is sensible. but the accountant is in no way liable, it's all down to you.
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???
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There's the obvious stuff like fuel, equipment purchases etc etc, but what else to you claim? I consider these to be legit. Mobile phone. Stationary. All equipment. Fuel. A room in my house for office use. There may be more. What about paying my wife say £50 a week for bookwork? Ideas and opinions, folks?
got an accountant to do it for you, cost is minimal and saves a whole lot of hassle, I enjoy paying my accountant once a year give them a box full of stuff they do everything give back the box and a bill and is all sorted, an accountant should save you money, I got nearly £3000 back from mistakes made by a so called person that new what to do.
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Although they are 'our' accounts, an accountant is the one who is chiefly in the poo if it all goes wrong
All i can say is it works for me.
Stephen
does that help.
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Who was he WW?
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Who was he WW?
a family freind, I never said anything to them as they tried to do me a favour.
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My books(retailing) have always had to do with mainly invoices as the cost of goods sold, so this business where the cost of goods sold is hardly anything came as a shock.
All our costs are either indirect or to do with depreciation.
Accountants do make mistakes. If the ir find a mistake in one they go through all his accounts (i mean customers).
As I see it the main problem is accounting for the cash that we recieve.
As more people file online the lower echolons are being made redundant. This frees up more time and resourses for enquiries and investigations.
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Although they are 'our' accounts, an accountant is the one who is chiefly in the poo if it all goes wrong
All i can say is it works for me.
Stephen
does that help.
Not really. N'mind.
Stephen
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The hairdressing analogy was trying to say that some accountants force templates on us whether they fit our business or not.
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The hairdressing analogy was trying to say that some accountants force templates on us whether they fit our business or not.
if you are emplying an accountant to work for you, you should be the one that tells them what you want if they cant do it find another.
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Have you ever been outside a hairdressers when the lady comes out over the moon with how she looks? Then the next and the next, except that they all have exactly the same hairstyle, which in turn looks exactly like the stylists.
Put it another way, is it best to accept a web template for your site or better to try to create your own?
Be your own financial director.
New Van next year? £1000 pole to service work you might not get?
Being on top of your books is the same to me as running a good business. Not all accountants understand our business.
Just read Stephens post. That is sensible. but the accountant is in no way liable, it's all down to you.
You've totally lost me with that post.
So to summarise your advice.
Your saying that the best thing to do is forget about an accountant, get yourself on a course and do it all yourself?
Arthur
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Have you ever been outside a hairdressers when the lady comes out over the moon with how she looks? Then the next and the next, except that they all have exactly the same hairstyle, which in turn looks exactly like the stylists.
Put it another way, is it best to accept a web template for your site or better to try to create your own?
Be your own financial director.
New Van next year? £1000 pole to service work you might not get?
Being on top of your books is the same to me as running a good business. Not all accountants understand our business.
Just read Stephens post. That is sensible. but the accountant is in no way liable, it's all down to you.
You've totally lost me with that post.
So to summarise your advice.
Your saying that the best thing to do is forget about an accountant, get yourself on a course and do it all yourself?
Arthur
sod that Art, get an accountant that does their job and that suits your business, I tell my accountant what I want and she does it as best she can
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Have you ever been outside a hairdressers when the lady comes out over the moon with how she looks? Then the next and the next, except that they all have exactly the same hairstyle, which in turn looks exactly like the stylists.
Put it another way, is it best to accept a web template for your site or better to try to create your own?
Be your own financial director.
New Van next year? £1000 pole to service work you might not get?
Being on top of your books is the same to me as running a good business. Not all accountants understand our business.
Just read Stephens post. That is sensible. but the accountant is in no way liable, it's all down to you.
You've totally lost me with that post.
So to summarise your advice.
Your saying that the best thing to do is forget about an accountant, get yourself on a course and do it all yourself?
Arthur
sod that Art, get an accountant that does their job and that suits your business, I tell my accountant what I want and she does it as best she can
Ian, that's what i do. I'm just curious about VG's posts
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Have you ever been outside a hairdressers when the lady comes out over the moon with how she looks? Then the next and the next, except that they all have exactly the same hairstyle, which in turn looks exactly like the stylists.
Put it another way, is it best to accept a web template for your site or better to try to create your own?
Be your own financial director.
New Van next year? £1000 pole to service work you might not get?
Being on top of your books is the same to me as running a good business. Not all accountants understand our business.
Just read Stephens post. That is sensible. but the accountant is in no way liable, it's all down to you.
You've totally lost me with that post.
So to summarise your advice.
Your saying that the best thing to do is forget about an accountant, get yourself on a course and do it all yourself?
Arthur
sod that Art, get an accountant that does their job and that suits your business, I tell my accountant what I want and she does it as best she can
Ian, that's what i do. I'm just curious about VG's posts
VG likes to be different me thinks ;D
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The most significant thing about employing an accountant is that when he submits your details to the revenue it goes on his headed paper and the revenue are much more likely to believe him than they are to believe you.
Also, he should save you at least his fees in tax but I personally have doubts about my accountant. I went to him because he was recommended by a friend but he doesn't inspire me with a great deal of confidence that he is claiming for everything I could be entitled to.
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The most significant thing about employing an accountant is that when he submits your details to the revenue it goes on his headed paper and the revenue are much more likely to believe him than they are to believe you.
Also, he should save you at least his fees in tax but I personally have doubts about my accountant.
I have doubts about every accountant.
They're making big money out of you.
I had an accountant for a few years.
When I started doing it myself I ended up paying £150 more tax.
But I saved nearly £200 by not using the accountant.
Unless you've got a big complicated business it's a waste of time.
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Not a waste of time for me
My time is more valuable cleaning windows, when i get a reciept it goes in my tin,
Once a week i email the hours my staff have worked, takes me 2 mins, get an email back with the payslips
At the end of the year i hand my accountant my "George" print off for money recieved and hand over my tin of reciepts, thats as much as my involvement is.
To me that is priceless , all for the sum of £300 a year.
My time is better spent moving my business forward without worrying about compiling my own accounts.
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Not all accountants understand our business.
;D ;D And in the very same light, not all window-cleaners understand the laws of accountancy and tax returns.
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My time is better spent moving my business forward without worrying about compiling my own accounts.
It's done once a year (usually about 2nd Jan), and takes me an evening.
Not exactly a hardship to save £200-odd.
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The most significant thing about employing an accountant is that when he submits your details to the revenue it goes on his headed paper and the revenue are much more likely to believe him than they are to believe you.
Also, he should save you at least his fees in tax but I personally have doubts about my accountant.
I have doubts about every accountant.
They're making big money out of you.
I had an accountant for a few years.
When I started doing it myself I ended up paying £150 more tax.
But I saved nearly £200 by not using the accountant.
Unless you've got a big complicated business it's a waste of time.
Squeeky
So in other words you were £50 up, but then you had to spend the time doing the accounts......was the time you spent doing it worth the £50 you saved (its a genuine question BTW) ?
Stephen
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well, whether my accountant uses a 'template' or not, what i know is that i dont have to do a fat lot when it comes to my accounts and that i haven't had much to pay in my first 3 years in tax.
For what he is charging me it is worth it (to me). His fee is one of the smallest of my costs during the year. Even if he wasnt claiming for all that he might, he certainly claims for more than i knew i could. For me its a toss-up as to whether i want to do it myself or pay to have it done, and for me personally its worth it. I have no head for figures.
Stephen
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My time is better spent moving my business forward without worrying about compiling my own accounts.
It's done once a year (usually about 2nd Jan), and takes me an evening.
Not exactly a hardship to save £200-odd.
Speaky are you upto date with all the changes with accounts etc and do you check regular one evening to do a full years accounts?? you could be costing yourself money, I did myself, now pay others so so much easier and they know all that is needed to now with updates etc as this is their job at the end of the day
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Accountants are worth their weight in Gold (or tax returns!)
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When I started out being self employed, the accountancy bit was the "worrying " part, but there is so much free help out there (including from the tax office) that as a one man band,I really cant justify the expense of an accountant when its actually fairly simple. Nobody has a better understanding of your own business than yourself,and once you,ve looked into it, you,ll find that if you can prove somethings been bought for business purposes, you can claim at least some sort of percentage for it.
A friend of mine (not a wc) has an accountant who manages to keep his tax bill down to a ridiculously low amount, but I know for a fact that some of the things he gets him to claim for ,are simply wrong.IE He claims for milage AND fuel/garage bills etc. Its all very well, but once the tax office cotton on,hes going to be facing a huge bill for several previous years incorrect accounting.
I fully understand why people use an accountant, particularly if you employ people, but its not for me.
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Accountants are worth their weight in Gold (or tax returns!)
yeah, i agree with that one. mine costs me about 300 a year, i have to do nowt, he does it all & has saved me tons of money since i went self employed
It is a large respectable accounting company & every year i try to work out my tax liability myself & have to say, i never get it down as low as what they do. He told me from the start that they didn't do anything (and wouldn't if asked) that wasn't totally above board so that gives me peace of mind too as i know any mistakes in my tax liability is down to me at the end of the day. ;)
tony
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There's the obvious stuff like fuel, equipment purchases etc etc, but what else to you claim? I consider these to be legit. Mobile phone. Stationary. All equipment. Fuel. A room in my house for office use. There may be more. What about paying my wife say £50 a week for bookwork? Ideas and opinions, folks?
Feen
In the tax mans own words, they say that you can claim any expense which is incurred for the sole purpose of earning business profits, and EXCLUDING all personal elements.
So if you are claiming for a phone then that phone must only be used for your business, if you do use it for personal use then this usage must be taken away from what you are claiming.
With motoring costs you have 2 choises only, you can claim for all the costs involved to run your vechicle like road tax, fuel, insurance, AA/Rac membership and so on, but remenber if you use you vechicle for private use then this percentage must be taken account for.
Or you can go the mileage way which means that you can claim 40p for each mile upto 4000 miles then it drops down to 25p.
Which ever way you go you cannot change to the other method unless you aquire a different vechicle.
As for claiming a room, yes you can claim a percentage of the gas, electric and council tax used, so if you use a spare bedroom you work the percentage out as follows.
You count how many rooms are in your house, you cannot count the kitchen, bathroom, and toilet, so if you live in a 3 bedroom house and have 1 living room and 1 dinning room. You have 5 rooms and you use 1 for business which = 1/5th, this is the amount you can claim for.
The most important thing to remenber is they DO NOT allow you to store any type of bedroom furniture in this room, if you do then you will have to pay back what you have claimed for plus interest and fines, and this will go back for 6 years.
If you only use a part of a room, then you can claim a nominal amount of £2.00 per week.
As for you paying a wage to your wife, if you do then you will also have to pay for employers liability insurance also sickness/holiday and even maternity payments.
The Inland Revenue do free courses, it's worth its weight in gold, remember an accountant will save you money, but if you give the accountant the wrong information and the tax man do a tax investication, then you are liable for the back taxes, fines and interest and not the accountant.
The tax offices computer picks at ramdon thousands and thousands of business for a closer look at their accounts, so remember it could be you, and they go back 6 years so kept them records or you are in big Doo Doo.
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The tax offices computer picks at ramdon thousands and thousands of business for a closer look at their accounts, so remember it could be you, and they go back 6 years so kept them records or you are in big Doo Doo.
No you won't be. Not unless they can prove you wrong.
Which they won't be able to.
Domestic work cash in hand is untraceable.
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The tax offices computer picks at ramdon thousands and thousands of business for a closer look at their accounts, so remember it could be you, and they go back 6 years so kept them records or you are in big Doo Doo.
No you won't be. Not unless they can prove you wrong.
Which they won't be able to.
Domestic work cash in hand is untraceable.
NEVER under-estimate the power & ability of these people, you are very foolish if you do. It is also up to you to prove yourself right not just them to prove you wrong!
There are many, many ways to catch you out. without going on about them but for instance-
You have no recorded earnings for such & such dates Mr. squeeky, BUT i see on these dates you have indeed claimed for fuel, here, look at your reciepts! etc. etc
tony
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Williamx, Thanks for your comprehensive reply. The only thing I will comment on is that my accountant told me that Tony Blair (the holy ar*ehole himself) pushed this through: you can claim your mobile phone bill wholly for your business, but your landline you cannot, if you are self employed.
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You are supposed to regularly reconcile payments into your bank account and keep a record of cash in hand, which is carried forward on a weekly basis. This clarifies what drawings you have made , and any cash you may pay into the bank.
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The tax offices computer picks at ramdon thousands and thousands of business for a closer look at their accounts, so remember it could be you, and they go back 6 years so kept them records or you are in big Doo Doo.
No you won't be. Not unless they can prove you wrong.
Which they won't be able to.
Domestic work cash in hand is untraceable.
True domestic work is mainly cash and therefore almost impossable to kept tract of, but the tax man gets around this by checking, every major purchase and holiday you have had for the last 6 years and how it was paid for, they will already know how much you say you have earnt and if they find one thing thats doesn't tally then they will assume you are fiddling and they will instead say you have earnt this amount and its now up to you to disprove them.
Don't forget there are many thousands of window cleaners who send their tax returns in every year, by looking at these figures, the tax man know how much we all earn each year.
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Don't forget there are many thousands of window cleaners who send their tax returns in every year, by looking at these figures, the tax man know how much we all earn each year.
Well they can't be very bright then.
All professions vary massively.
We've already established on this forum that some make £200-300 a week, while others make around £1000.
I only work 3 days a week at the moment.
How can I earn what an expensive cleaner in an expensive area does on a 5 day week?
There's no way they know anything about me or anyone else.
After the way I was mislead and ripped off last time, I won't be doing the b*stards any favours.
Sorry, I just hate them.
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I wouldn't be surprised if my next lot of accounts are queried even though they are legit (as they always are). I have shown close to the same turnover as the previous year but with much higher expenditure. This was the setup costs of WFP.
One thing my accountant did tell me is if you are putting in a set of accounts that look odd because of a particular reason, write a letter with the accounts to briefly explain the situation. If you put them in without the brief explanation, you stand much more chance of getting investigated.
For instance, I had trouble working for a few months several years ago due to illness. I gave my accountant a letter with brief explanation saying that if they wanted more details to contact me. They never did. My turnover (and profit)was way down on the previous year as you would expect in such a situation. Obviously I don't know if they would have selected me for investigation without that letter but it may well have helped. In the accounts that I will be submitting soon, I made a big investment in WFP equipment and a van and also lost my two biggest customers. My expenses are way high but all perfectly correct. I paid out a fair bit in interest on the loans for the van and equipment too which is all tax deductible (the van being subject to apportionment as there is a bit of personal use).
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Don't forget there are many thousands of window cleaners who send their tax returns in every year, by looking at these figures, the tax man know how much we all earn each year.
Well they can't be very bright then.
All professions vary massively.
We've already established on this forum that some make £200-300 a week, while others make around £1000.
I only work 3 days a week at the moment.
How can I earn what an expensive cleaner in an expensive area does on a 5 day week?
There's no way they know anything about me or anyone else.
After the way I was mislead and ripped off last time, I won't be doing the b*stards any favours.
Sorry, I just hate them.
Every sane person hates paying tax, buts its a nessasary evil we have to live with.
All I would say to anyone who is creative with their taxes is be aware.
Window cleaning is our proffession and we have all learnt over time how to to it correctly, the tax man is also a proffessional who has vast resources to draw on to catch us.
They know that everyone who is handling cash will not declare every penny, the odd fiver or tenner here and now is easy to disappear, buts its when you start to get greedy, then you get caught out, ask Al Capone and Robert Maxwell.
If they can be caught with their resources, what chance do we have.
The main problem with window cleaners is we all have regular customers who go on a list which the tax man will cross check with, so when they are following you and you kept cleaning houses that are not on that list, expect a few questions.
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I really cant justify the expense of an accountant when its actually fairly simple.
Its only simple if you know what you are doing. I dont :'(
stephen
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I really cant justify the expense of an accountant when its actually fairly simple.
Its only simple if you know what you are doing. I dont :'(
stephen
Go on a course that the tax man offer for free, then you will know how to do it.
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I really cant justify the expense of an accountant when its actually fairly simple.
Its only simple if you know what you are doing. I dont :'(
stephen
Go on a course that the tax man offer for free, then you will know how to do it.
No, i think you are missing the point. My maths and head for figures is terrible.
Stephen
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as far as I am aware all accounts are done via a computer your tax return is scan and fed to a computer if it finds something wrong it chucks it back and they then look into it, they hand pick people to investigate, as long as you are doing no wrong then there is nothing to worry about, an accountant can save you money, even the people that do thier books themselves could still save money. This is one of the reasons I use one, the other is I hate doing books, every thing goes in my bank, and is paid out from there this way I have clear records of everything. the letter in regards to an explination is a good idea as the computer my kick out the abnormalities (spelt wrong) and a letter they can read and understand.
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I really cant justify the expense of an accountant when its actually fairly simple.
Its only simple if you know what you are doing. I dont :'(
stephen
Go on a course that the tax man offer for free, then you will know how to do it.
No, i think you are missing the point. My maths and head for figures is terrible.
Stephen
You don't have to be a math genius, to go on one of these courses, what they cover is your tax return form, what figure needs to go in which box, the tax return form tells you what to do with each box, so its quite easy to do.
They also tell you what you can and more importantly what you cannot claim for, as for the tax return form and working out what you need to pay in regard to nic 4 and income tax, all you need to do is fill in the form, send it off to your tax office, they will do the number crunching and then send you a bill, which you have to pay by a certain date.
If you use a accountant, he will be able to fill in this form, if you give him the correct information, but if you decide to do it yourself, you can always contact them on 0845 302 1437, they are willing to go step by step in filling in the form correctly.
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I have a good head for figures but the way I look at it is simple,tax returns is an accountants job not mine,I cant be bothered with it,all my figures are above bourd so I have nothing to worry about,and the best bit is the £180 he charges me comes off me profit as it is an expence so why the hell should I bother to do it myself.
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I have a good head for figures but the way I look at it is simple,tax returns is an accountants job not mine,I cant be bothered with it,all my figures are above bourd so I have nothing to worry about,and the best bit is the £180 he charges me comes off me profit as it is an expence so why the hell should I bother to do it myself.
Well quite. My clients have cleaners (me, obviously), they have window cleaners, help with the ironing etc etc etc so i think
'so-d it, i'll have help with me books if it's the only help i have'
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I have a good head for figures but the way I look at it is simple,tax returns is an accountants job not mine,I cant be bothered with it,all my figures are above bourd so I have nothing to worry about,and the best bit is the £180 he charges me comes off me profit as it is an expence so why the hell should I bother to do it myself.
Only a percentage of it comes off your tax liability, which is £54.00 the rest, £126.00 comes off your own money after you have paid taxes.
So because you are good at figures and you could of done them yourself, but did not, you now have £126.00 less than you would have.
Or look at it another way, you charge say £8.00 per house to clean, you have now just cleaned almost 16 houses free of charge.
Remember that not all of the money you spend, comes off your tax liability, only a percentage does, the rest comes out of your bank account.
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There's a vast array of expenses you can claim for in business,.. and the chances are that you won't think of all of them. A good accountant will save you more on your tax bill than they will charge you in fees,... and save you a whole lot of headache and evenings spent with a stack of forms and a calculator.
If your business is small, and you have the time and capacity to do you own accounts,.. at least buy a couple of good books. Tax guides are published and reviewed yearly, and will really help with filling in those forms.
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I have a good head for figures but the way I look at it is simple,tax returns is an accountants job not mine,I cant be bothered with it,all my figures are above bourd so I have nothing to worry about,and the best bit is the £180 he charges me comes off me profit as it is an expence so why the hell should I bother to do it myself.
Only a percentage of it comes off your tax liability, which is £54.00 the rest, £126.00 comes off your own money after you have paid taxes.
So because you are good at figures and you could of done them yourself, but did not, you now have £126.00 less than you would have.
Or look at it another way, you charge say £8.00 per house to clean, you have now just cleaned almost 16 houses free of charge.
Remember that not all of the money you spend, comes off your tax liability, only a percentage does, the rest comes out of your bank account.
that is true by the way, I thiught the same thing when I got an accountant, you cant claim the whole lot back, who ever informed you was wrong, I myself would clean 50 houses a year 1 a week not to do my accounts I hated it, my wife hair bill costs more than my accountant a year and I have to pay that and still get headaches, so accounts no thanks just send and pay the bill
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Using a bank account for all expenses is brilliant.
Most of you seem to be using an accountant to do a profit and loss account ( income statement is another word for it). And then fill in your return.
The info I'm working on, and I don't say copy me because others take a different view is this.
Consumables- all of it.
Computer stuff- all of it (less any personal use)
First year allowance- 40%
And then everything apart from vehicle into an asset pool at 25% in the years thereafter, added to by items that have a first year allowance and then join the rest.
Other stuff- adverts stationery etc- all of it.
Then as mentioned by others use of home- water bill- phone etc.