Hope someone can help as im trying to get my head around expenses and tax ect. My question is this : As a sole trader (im fairly certain im right in thinking that) I am allowed to claim back 45ppm for work related travel costs; however just now I read that I cannot claim any milage for traveling from my home to the place of work.
If this is correct (I read it on a website), then supposing I had only the one job to do in one day before returning home, then ultimately I could not claim for driving to the workplace; could I claim for driving back home again !?
As im only doing small one off jobs (i.e from home to work and back again), then this is not good, its also skewed my carefully devised excel books. Bearing in mind that I probably wont make enough to be taxed anyway is not the point. Can you only claim for travel from job to job, thanks for any advice.
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The tax office states that you must keep accurate records for your business. For example, your accounts, records of tax you have paid and all other records of your income and outgoings.
However as a small self-employed business you may be able to use 'cash basis' accounting, based on the money going in and out of your business, rather than traditional accounting methods that cover stock on hand, amounts owed and so on.It is by using this system that you can claim flat rate expenses for vehicles, use of home for business and use of business premises as a home.
It is complicated to read about at first but i highly recommended a visit to the .gov.uk website for HMRC. I will try a send the links on a later reply. This cash basis is simplified accounting and is supposed to make self assessment easier. I am just about to do my tax under this system and so far it seems to simple! Claim for everything that you legally can and provide as much data as possible. I have spoken to a fantastic chap at the tax office on their advice line who was excellent at giving advice.
https://www.gov.uk/simpler-income-tax-cash-basis
4. Cars, vans and motorcycles
The records you need to keep depend on whether you’re claiming capital allowances for your vehicles.
Traditional accounting
When you buy vehicles for your business, you may be able to claim the cost against your tax bill. This is called claiming a ‘capital allowance’.
If you claim capital allowances, you must keep records of:
the purchase price
the allowances claimed
any disposals, eg vehicles sold, exchanged or given away
the remaining value
any private use
CO2 emission level (for cars bought after 6 April 2009)
You can use the mileage rate for 2013 to 2014 instead, if your business income is less than the VAT registration threshold of £81,000.
Using cash basis
You need to keep the records above for the 2013 to 2014 tax year if you claim capital allowances.
You can claim for new vehicles using simplified expenses instead.
Using simplified expenses
For the 2013 to 2014 tax year, simplified expenses allows all businesses to use the mileage rate, instead of claiming capital allowances and running costs.
If you decide to use simplified expenses, you only need to keep a record of the business miles you’ve done.
Please call the tax advice line as they were very helpful.
8.00 am to 8.00 pm, Monday to Friday
8.00 am to 4.00 pm Saturday
Closed Sundays, Christmas Day, Boxing Day and New Year's Day
0300 200 3310
OK thanks, I should really go and see a specialist. Sorry for posting here I should have put in the other forum. Thanks thou.