Folksy Ltd

Tax Deductions

(Haley Glover) #1

Hello

I have had a search through previous topics and cant find an answer, so posting this as a new topic.

What is allowed as deductions in your tax return? I am doing quite well selling this year/last year and dont want to get to the end of the year and owe the tax man. So I need to be sure that my taxable deductions/expenses are correct.

I know I can claim materials, postage supplies and equipment. I need to sort out a portion of my electric bill that heats my kiln. But what little things might I be missing? I would like to purchase more art/craft magazines to keep up with trends, these are expensive, can I buy these from my business account?

Any help appreciated.
Haley

(Sasha Garrett) #2

You might find the following useful:
https://www.gov.uk/expenses-if-youre-self-employed/overview
As you say you can claim a proportion of your electric bill, not just for running the kiln but for heating/ lighting your workshop. You can also claim a proportion of phone and broadband costs (you need them to run an online business) and council tax (if you work from home rather than a business premise). You are allowed to buy professional or trade journals as an allowable expense - not sure how general these are allowed to be or whether they would directly have to relate to pottery. You can also claim for membership to a professional body.
Hope that helps
Sasha

(Deborah Jones) #3

If relevant you can have magazine subs, work clothing ,course fees, office equipment .A work portion of internet, telephone and car fuel.
Always worth topping up on new tools and materials too.

I find it is worth paying an accountant as he saves me money (and I hate paperwork ) I would rather pay him than owe the tax man more than necessary.

(Roz) #4

Don’t forget insurance costs and any petrol/mileage costs for trips to post office, fairs etc. You can pretty well claim anything which you pay for as the result of running the business so just think of what expenses would disappear if you stopped making and selling.

(Elaine) #5

Can you tell me if you are able to claim all the insurance cost or just a percentage please.

(Sasha Garrett) #6

Depends on the insurance eg if you took out a specific stock/ materials/ equipment/ workshop insurance or public liability policy then you would be able to claim all of it. If you are looking to claim a percentage of your buildings/ contents policy I don’t think that’s allowed (but if you had an expensive bit of equipment that had to be specified on the policy you should be able to claim the cost of the premium relating to that item ie the difference in premium between it being named and not named on the policy). Its also worth checking the small print as a lot of domestic buildings/ contents policies won’t cover items used for business. And check your car insurance covers you for business use (which is what driving to a craft fair counts as) not all of them do.
Sasha

(Elaine) #7

Thank you Sasha. :blush:

(Haley Glover) #8

Thank you. I had read the link, which was useful but didnt answer my question about little things. I def need to sort out my electric bill, for the kiln and as you say the heating and lighting.
Thanks

(Haley Glover) #9

Thanks, busy thinking what equipment I need. How much is an accountant? roughly?
H

(Haley Glover) #10

Thank you, busy thinking.
H

(Kate Adams) #11

I work for an accountancy practice and we charge between £200 and £400 per year for advising our clients and completing a tax return…I imagine most accountants would charge roughly the same. Hope this helps…also you can check out the HMRC website, they have a section for sole traders…it’s a bit of a pain to navigate, but it does provide you with details on what you can and cannot claim. Hope this helps :blush:

(Haley Glover) #12

Thank you.
Yes that helps. I have looked at the sole traders section and I think I kind of know now what I can and cannot claim.
h

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