Tax return due, some advice please

[armyash]

Hi

Got a letter through from HMRC today saying I need to complete a tax return for April 2013 - April 2014. I have until October 31st for paper copy or jan 31st if doing online. Plenty of time.

I wanted to get some advice as I have never done one before, most lads I know who work on a self employed basis reckon they always get a minimum of £1500 back. (I don't understand how but wont be getting my hopes up lol)

Who does theirs themselves?

Who gets an accountant to do it for them?

What I have been advised is, take all my receipts etc to an accountant and let them deal with it as what they can save/claim for on my behalf makes it worth while as they will pretty much save me their fee.

I think that means they will claim for me the maximum allowances possible on what ever I can claim against.

Hope this makes sense, if anyone can shed some light that would be great, thanks.

 

[Leo21]

Are you sellf employed and pay tax at source?

 

[PlumbersMate]

Hi

Got a letter through from HMRC today saying I need to complete a tax return for April 2013 - April 2014. I have until October 31st for paper copy or jan 31st if doing online. Plenty of time.

I wanted to get some advice as I have never done one before, most lads I know who work on a self employed basis reckon they always get a minimum of £1500 back. (I don't understand how but wont be getting my hopes up lol)

Who does theirs themselves?

Who gets an accountant to do it for them?

What I have been advised is, take all my receipts etc to an accountant and let them deal with it as what they can save/claim for on my behalf makes it worth while as they will pretty much save me their fee.

I think that means they will claim for me the maximum allowances possible on what ever I can claim against.

Hope this makes sense, if anyone can shed some light that would be great, thanks.

Have always used an accountant and always get about 3k back after his fees. My mate done his own one year and got 7k back but had them knocking on his door lol

 

[AWheating]

if you get paid via cis you will have paid 20% on the first £9440 (amount allowed before you pay tax) so 9440 x 0.2 = 1,889 aprox

so you will automaticaly in theroy this will come back, before any other expenses, allowances, costs etc......

it will be more if its your first year and you paid 30% at the start before your utr number was issued.

 

[cr0ft]

Never bothered with an accountant myself. My view is that you can read up on what you can and cannot claim for and book-keeping software which makes the end of year returns a straightforward affair. That saves a few hundred pounds straight away, well worth a day off work to complete it.

Anything that I can do myself that is charged at a higher rate than I can charge I do myself.

 

[mfgs]

I always work out all my own figures and get an accountant mate to do the return online for me.

 

[Leo21]

I practice what I preach and get a professional in. You simply can't know the wrangles that a good accountant can.

 

[REDSAW]

£600 back for working from home.
the garage as a workshop if you 'make or repair' in it etc.
theres a few things if you have access to an accountant.

 

[armyash]

Are you sellf employed and pay tax at source?

Yes self employed but working for a firm. They sort the tax but I do the NI which I paid for the year a week ago.

Thanks for all the replies mixed responses is always good. I think I'll use an accountant this year as it's my first one, hopefully next year I'll be able to afford to spare the time and do it all myself. My brain is fried with all this plumbing malarkey!

 

[REDSAW]

Yes self employed but working for a firm. They sort the tax but I do the NI which I paid for the year a week ago.

Thanks for all the replies mixed responses is always good. I think I'll use an accountant this year as it's my first one, hopefully next year I'll be able to afford to spare the time and do it all myself. My brain is fried with all this plumbing malarkey!

might get into trouble doing that!!

 

[Leo21]

Yes self employed but working for a firm. They sort the tax but I do the NI which I paid for the year a week ago.

Thanks for all the replies mixed responses is always good. I think I'll use an accountant this year as it's my first one, hopefully next year I'll be able to afford to spare the time and do it all myself. My brain is fried with all this plumbing malarkey!

A word of caution, ask for recommendations. A bad accountant can cost you money.

 

[lame plumber]

pay my accountant £350 for doing my returns, after Ive done all the legwork, ie expenses,income summary etc. Then he does some capital allowances etc and gets me more allowances than I can find and the Mrs is put on the books to use her allowances and last years tax bill came to £3.40. Got to pay bit more this year as did to well! My main aim is to sit below the vat limit as life is simpler that way

 

[Killy Bing]

might get into trouble doing that!!

Not if he is cis surely.

 

[anz]

Not if he is cis surely.

Think he means having a separate gas safe and competing with his employer.

There is nothing wrong with being self employed and employed at the same time.

 

[village idiot]

Hi
I wanted to get some advice as I have never done one before, most lads I know who work on a self employed basis reckon they always get a minimum of £1500 back. (I don't understand how but wont be getting my hopes up lol)

The tax man will only give you back money that you have already given to him. You can not be ''rewarded'' if you have not contributed into the pot. If after submitting your accounts, it becomes obvious that you are ''owed money'' by the revenue (and let's assume it's your first year of trading), this owed amount will be carried forward and set against any future taxes you have to pay. Even if it's your 10th year of trading, the revenue will only pay you back if their records show that tax they have collected from you in the past exceeds what you are owed.

For a simple example, let us assume that you have been trading for 5yrs and over that period of time, you have paid tax of £1,500. If on the 6th year, after submitting your tax, you incur a net loss of £1,700. The revenue will only pay you £1,500. The balance £200 will be carried forwards and offset against future tax payments. Should you make a loss in year 7, this will just be added to the earlier £200 and again carried forward etc.

In effect, do not just assume you will get £1,500 from the tax man because your friends said they got one

 

[PlumbersMate]

The tax man will only give you back money that you have already given to him. You can not be ''rewarded'' if you have not contributed into the pot. If after submitting your accounts, it becomes obvious that you are ''owed money'' by the revenue (and let's assume it's your first year of trading), this owed amount will be carried forward and set against any future taxes you have to pay. Even if it's your 10th year of trading, the revenue will only pay you back if their records show that tax they have collected from you in the past exceeds what you are owed.

For a simple example, let us assume that you have been trading for 5yrs and over that period of time, you have paid tax of £1,500. If on the 6th year, after submitting your tax, you incur a net loss of £1,700. The revenue will only pay you £1,500. The balance £200 will be carried forwards and offset against future tax payments. Should you make a loss in year 7, this will just be added to the earlier £200 and again carried forward etc.

In effect, do not just assume you will get £1,500 from the tax man because your friends said they got one

Yeh but I'm sure Ash gets taxed at source

 

[village idiot]

Yeh but I'm sure Ash gets taxed at source

In which case he will pay the difference or be repaid the difference on submitting his return

 

[rocketmanbkk]

I'm self employed and did mine online yesterday.

I made a loss in my first year but it was simple to do.

 

[armyash]

Ok thanks I think I get it now.

I'm not expecting to be 'rewarded', if i get anything back it will be a bonus.

I'm more concerned with doing things the right way and not getting in trouble.

I work for a company on a self employed basis and they pay the tax - is that normal?

 

[villa_tom]

Ok thanks I think I get it now.

I'm not expecting to be 'rewarded', if i get anything back it will be a bonus.

I'm more concerned with doing things the right way and not getting in trouble.

I work for a company on a self employed basis and they pay the tax - is that normal?

Ive worked like that before mate. Its fine.

What you will find is that you've paid tax on all of your earnings through the year, but you should only pay tax on profit.

So once you've worked out what you've spent through the year, you take that amount off your turnover and that's what you'll be taxable on.

So you will be due a refund because you will have over paid

 

[AWheating]

its simple if you have paid cis, they already have your tax and its your job to claim it back.

you have the 9440 threshold as i mentioned earlier, so first thing to understand is if your profit is less than this then you will get every penny back you have paid minus any national insurance you may have to pay.

so for example lets say your total earning/turn over was 20,000. The company has paid 20 percent of this to the tax man, so the tax man holds 4,000. You then work out what your total profit is after all expenses/costs of your business.

say your total profit was 16,000. take away the 9,440 your allowed before tax which is 6,560. 20% of 6,560 is 1,312. take this away from the 4,000 you have already paid and the amount you have overpaid is 2,688. Minus any NI you have to pay.

Any non cis work will need to be added to your totals but because you have yet to pay tax on this will decrease the amount you get back. If 20% of this figure is more than the amount to come back from the cis work then you will need to pay the difference in tax to the man.


you business costs can include van (fuel, insurance, service, mot, tyres, etc...), PLI, Registrations, Tools, home office (inc. household costs), Training, telephone, website, work clothing (inc washing them) and many other things if you can prove its for work.

 

[armyash]

its simple if you have paid cis, they already have your tax and its your job to claim it back.

you have the 9440 threshold as i mentioned earlier, so first thing to understand is if your profit is less than this then you will get every penny back you have paid minus any national insurance you may have to pay.

so for example lets say your total earning/turn over was 20,000. The company has paid 20 percent of this to the tax man, so the tax man holds 4,000. You then work out what your total profit is after all expenses/costs of your business.

say your total profit was 16,000. take away the 9,440 your allowed before tax which is 6,560. 20% of 6,560 is 1,312. take this away from the 4,000 you have already paid and the amount you have overpaid is 2,688. Minus any NI you have to pay.

Any non cis work will need to be added to your totals but because you have yet to pay tax on this will decrease the amount you get back. If 20% of this figure is more than the amount to come back from the cis work then you will need to pay the difference in tax to the man.


you business costs can include van (fuel, insurance, service, mot, tyres, etc...), PLI, Registrations, Tools, home office (inc. household costs), Training, telephone, website, work clothing (inc washing them) and many other things if you can prove its for work.

Thanks, that's lots of good info. I now also understand why I struggled with maths in school!

How can I prove such things as Phone costs or the cost of washing my clothes?

 

[villa_tom]

Thanks, that's lots of good info. I now also understand why I struggled with maths in school!

How can I prove such things as Phone costs or the cost of washing my clothes?

Just file all your phone bills and keep them on record, keep all receipts and paperwork.

as for claiming washing your clothes, I'm not sure as I've never done it. But I'm sure it'll just be a set figure that the HMRC sets each year

 

[armyash]

Decided to have a go myself.

Registered for the online self assessment so just waiting on my activation code from the government gateway before I can start. Watched an hmrc tutorial video and it looks straight forward, there seems to be plenty of help available from HMRC. If I feel like i'm missing too much info out I'll let an accountant sort it but after speaking to a couple of people I think i should have no problems.

 

[villa_tom]

Decided to have a go myself.

Registered for the online self assessment so just waiting on my activation code from the government gateway before I can start. Watched an hmrc tutorial video and it looks straight forward, there seems to be plenty of help available from HMRC. If I feel like i'm missing too much info out I'll let an accountant sort it but after speaking to a couple of people I think i should have no problems.

do it yourself mate. Its easy peasy lemon squezy

i do mine myself and it takes about 10 minutes.

 

[kirkgas]

I'm self employed and did mine online yesterday.

I made a loss in my first year but it was simple to do.

You are right these days, plenty people find it easy to make a loss :-(

 

[kirkgas]

Ok thanks I think I get it now.

I'm not expecting to be 'rewarded', if i get anything back it will be a bonus.

I'm more concerned with doing things the right way and not getting in trouble.

I work for a company on a self employed basis and they pay the tax - is that normal?

It depends on the company policy, I'm self employed and do some work in two different colleges, both tax me at source every month, it's their policy although my accountant suggested it wasn't the best way for me, but to be honest if they didn't take it at source I would put it away anyway, but at the end of the year he does my accounts and I claim £0.40 per mile which comes off my taxable portion, can't remember what else he claims for me, don't care I just sign the forms haha, that's what he gets paid for, but I got rebates totalling about £4k the other month, plus the benefits back from taking dividends from our family business rather than wages etc

 

[armyash]

I have kept all my receipts for phone costs, tools, uniform etc. Hopefully it's clear the other expenses I can put down.

I will keep a diary for this next tax year and keep a note of everything coming in and out which will make things easier to calculate for the next self assessment. Something I should have been doing this year but didnt cross my mind but now i know.

 

[stevetheplumber]

personally i would use an accountant they will find much more than you will to set against tax

 

[armyash]

personally i would use an accountant they will find much more than you will to set against tax

now i'm thinking that might be the best thing to do! I will attempt it myself but if i'm missing too much I will just pass it over to an accountant before i submit it.

Thanks