View Full Version : Purchases before business is set up
I am gearing myself to start doing my online tax return in next couple of weeks - it will be my first one!
My question is, I bought a kiln and loads of glass couple of moths before my first sale (and therefore couple of months before I registered my business). I thought I read somewhere that it should be included in my tax return which makes sense to me but I just wanted to confirm with you if anyone knows that is the case.
23-08-2009, 12:04 PM
I think you can claim for business purchases up to 3 months before registering. With your kiln you will need to capitalize and offset a portion as this will be used for a longer period of time. My insurers know I run my own business but have never made me change to a commercial policy, perhaps each insurer is different, I am with Ford Insure.
23-08-2009, 12:34 PM
Capitalize. Offset. I bet you next question will be "How do I do that!?!?!?"
When you fill in your tax form, online or on paper, it comes with a wodge of pages that explain everything.
If you are still puzzled the answer can be googled.
And if you are still bemused ring your local tax office and talk to a human being. They can also send you leaflets for tax dummies that tell you what to do.
You have to be a bit clever because sometimes spreading the cost over several years is the best thing for you to do when trying to work out how not to pay more tax than you need to. Like if you were going to pay no tax the first year and a bit the second etc. If you haven't earned enough to pay any tax your tax allowable expenses go to waste so being able to put some of the cost down in the second year (when hopefully you will have earned enough to pay tax) is a good thing for you.
sometimes (like if you can't resist buying one big tool/shed/computer/van each year) (I'm investing and expanding - not indulging and enjoying myself ;)) it might be better to put the whole amount down as a tax allowable expense for that one year to cut down the amount of tax owed that year if it's been a good one.
When you get to the "Whaaaaa!" what box does this go in?" bit - your kiln is a capital asset.
The glass goes into the erm.....it gets used up quickly, box. What's that called, Carolee?
Annie - sometimes my brain is so full of stuff I just can't find the word I want ;)
23-08-2009, 06:22 PM
Sorry if i am being a bit thick! I thought the tax year ran from April to April, so aren't you doing you tax return a bit early?
23-08-2009, 06:24 PM
Sorry! Never mind that, I am being a bit thick after all ;)
23-08-2009, 07:51 PM
I favour the last minute panic approach. After all you want your money to sit in your bank earning you loads of interest. Er what's my bank's interest rate at the moment? ) 0.00000000001%? ;)
Thanks for your answers guys. I provisionally filled the online return and it is showing that they owe me 83 pounds, but I still need to check it through before I send it. Yeah, I am a bit early but this is my first year and I am paranoid I will miss the closing date and end up in a prison! :mf:
07-09-2009, 10:40 AM
Whisper - they forgot to remind my son to pay his VAT so he paid it a month late. They 'forgave' him........Aw, sweet....;)
Powered by vBulletin® Version 4.2.3 Copyright © 2016 vBulletin Solutions, Inc. All rights reserved.