Mugshots;116825 wrote:From the off I have always wanted to keep the business above board. Me being me I have totally forgot about my tax return. Luckily I have until Jan 2017.
My question is this. I have no where near earned enough to be in profit after paying for extension to be built to house business, paying for pc, printers, press's, some stock, work tops, cupboards etc etc but most of the stuff has no "actual receipt" as either bought through ebay, second hand or like the building work, done by a friend in the trade. I have receipts for most stock but it wasnt all bought at the same time.
What do I do now?
Good advice here is to get an accountant. Some quick lessons:
Sales of stock is your revenue but if you bought £200 of stock, sold printed items for £200 but still have £100 of stock left you have a profit of £100 not £0.
The cost of printers, pcs, presses, worktops, cupboards etc all have a useful life lasting more than one year so only the cost that relates to the year can be off set against your profit, not the whole sum paid. These 'assets' and 'fixtures' could be charged as an expense at, say 25% each year.
As for the extension to your house, if this isn't to do with your business then that won't count as an expense. Even if the extension is 100% business related it will have a minimal cost to the business each year if anything at all. You may have spent a lot of cash doing this but as far as the business expense is concerned there won't be anything that can be claimed against your profit if it is your home, not a business premise. You may be able to offset some costs of running your home against your business but an accountant will help you with exactly what you can offset.
Just because cash has come in and cash has gone out doesn't mean you haven't made a profit on your business activities. If this is your only income then you can make a reasonable profit as a sole trader equivalent to the personal tax allowance. So you may not have a tax bill to pay, but you will need to complete a tax return otherwise an automatic penalty will apply (and grow) if you don't submit a tax return by the due date.
Complicated business
