Clean It Up
UK Floor Cleaning Forum => Carpet Cleaning Forum => Topic started by: Mark_P on September 30, 2008, 01:38:37 pm
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hi all, can anyone advise me on what is tax deductable for sel employed sole trader carpet cleaners? have tried the internet with limited success.
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add an accountant to your "I want" list
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everything is TD with a valid reason thats linked to your business, from storage in your home to clothes that you use to work, electrical goods, electric and gas (a small percentage) if you can prove its used for business e.t.c, all you need is a good accountant, they usually pay for themselves.
hope this helps
derek
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The guy to ask is roger from (Dr carpet)
Am sure he will point you in the right direction :)
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contact your local tax office. they have free seminars on filing your own tax return and what is tax deductable.
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Depends how much work you get him to do.
If you just give a bag with all your "tickets" in then he will charge you accordingly - a lot.
However, if you keep things tidy, and better still, keep a double entry book then you pay less.
My accountant showed me how to do the double entry book 18 years ago and am still doing it - he charges me about £400 + vat per year.
Its worth it to get rid of any hassle of form filling etc, and he knows what is allowable and not.
Two "people" I dont mess with - the tax man and my accountant - dont want to upset either!
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Do they still do business link courses? They are well worth doing.
My Accountant works from home and does mainly self employed. Big firms have big overheads which you end up paying for.
Just make sure they are Chartered.
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Definitely agree with Mike's last comment.
Don't confuse a bookkeeper with an accountant though. As Joe said the more of the preparation you can do the cheaper your bill will be.
An accountant is there to keep you on the straight and narrow and will advise what you can claim for and in what proportions (for example use of home for office). An accountant though is on your side and will help you claim for things you may not have thought of. Whilst you can do your returns yourself the tax office will only ensure it is correct, they will not go out of their way to show you ways of reducing your tax bill.
Your accountant will also be able to advise on your own personal tax return which will also need to be done as well as your accounts.
If you go limited you must by law have your accounts signed off by a chartered accountant but they will also be able to help you with other statutory returns.
A good accountant should be able to save their fees in reducing your tax bill by an even larger amount.
You can claim for anything you use for your business but not everything will be allowed. You can even claim for the cost of your Christmas party subject to a maximum of £150 per person (which may include a night away in a hotel) providing all employees are invited; which is precisely what Doctor Carpet and Nurse Carpet (ie my wife) have done in the past as we are the only employees!
Whilst one-man accountants can be cheaper if they work from home there are also down sides. I have known of accountants who have become unavailable, or been on holiday when you need them, disappear of the face of the earth, lose your books etc. etc. Obviously a large firm shouldn't do any of these and can often bring greater expertise to the mix. Often a larger firm can carry greater weight in any dispute with the tax authorities.
Beware also of accountants who offer a fixed deal as opposed to an estimate (like we will often do as a guide price) as their hearts (and wallets) will not be particularly interested in you if there are problems.
Claim for things like chemicals, stationary, advertising, repairs, postage. I have a separate business telephone line so there is no argument about what percentage of calls made on it are business or personal. The same goes for vehicles. Any capital expenditure eg machines can't be written off 100% against tax in the first year, they are written down over a number of years to reflect wear and tear.
As you can see the list goes on but I hope this answer gives you a flavour of the issues involved.
Roger
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Well covered post Roger. ;)
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depreciation is a good one and sometimes overlooked.
not sure if thats what roger meant at the end there, my van and truckmount depreciate in value over the years and i can use that against my tax.
derek
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One i forget is work cloths
But do they have to be exclusive
Do not think you can claim suit for visiting clients
But maybee you can as when in retail management I used
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Ian
It depends. that's why you would use an accountant. I use overalls for working in thus they could only be but for work use. (Once seen my overalls are never forgotten!!)
Shoes. Again I specify from which account I take payment for them to make it clear that they are used exclusively what they are used for. No arguments from the tax man. (In our game it is more important than many jobs to keep shoes exclusively for what we do.)
I used to wear a suit in the bank. There was no tax liability on my P11d as there was a little bank logo on the suit and this was sufficient to show it was provided exclusively for work.
Perhaps you should sew an NCCA badge or your own logo onto the suit in a discreet area and then you shouldn't have a problem claiming 100% allowance. Otherwise your accountant would probably only allow you to claim a percentage of the value of the suit.
Roger
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excellent info here thanks. i will definitely be looking into the accountant option then! thanks all
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As of next year any new purchases will be 100% tax deductable in first year. They are stopping the 50% and carried forwad to next years rule.
I think it was giving too many peoplr hassle and subsequently more hassle fot the tax office.
This was covered on the tax seminar i was on 2 weeks ago.
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I had a big agument about private mileage in the van. I do not use the van for pleasure!! only work, so I refuse to pay for private use. Saves a bundle.
Trevor
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Hi Trevor
Yes that's another favourite of the tax man. Helps if you have a second vehicle so that doesn't become an issue.
I had an argument about mileage as well. Their argument was that the mileage to the first job of the day shouldn't be allowed as this is in their eyes your own costs of getting to work in the same way as PAYE employees have to pay their own travel costs. However....
two points in our favour as that you could simply argue that your first job of the day (every day) is to a "next door neighbour", and secondly, I have subsequently found out that their argument is only valid in cases where you always go to the same place to start work pretty much every day. SO for example, if you went to a chemical supplier every morning before going off to clean that would then trigger the rule about paying mileage only from when you left the supplier's premises.
Diamond
Interesting point you make. I'll need to check into that although on the face of it it doesn't sound quite correct. Giving 100% deduction does stimulate investment in capital expenditure and I can remember when the Chancellor made all IT investment 100% deductible in the first year for a few years. But, in giving 100% allowance, it will firstly distort investment plans over the longer term as much will be brought forward as most decision makers will take the view that it cannot last and secondly it reduces tax take for the Revenue. Given that the IR is strapped for cash at present this would seem a perverse decision by them in the current climate. Perhaps the 100% allowance was not in relation to capital expenditure?
But as I say I could be wrong and your information warrants further investigation.
Roger