Tax help :(

[Curious Cat]

I've just done my online tax return. I'm employed and self employed. I made a loss last year but when I've completed the self assessment I owe tax?? Its only a small amount 95p?? but I was expecting to get an actual refund as this seems to be what other people seem to suggest happens. I've called the helpline a got some very sharp answers :( I'd put my loss in the box to carry over to next year as I assummed that was what I should do. This is where the curt man advised me I'd gone wrong and if I want to offset then I need to put it in one of the other boxes.

Before I submit I just wanted to ask people which they do and what are the pro's & cons? Obviously if I offset I should get a tax refund, but does that mean that come next year I don't carry that loss over into the next years figures?? If I carry it over, can I then offset in effect 2 years losses if I want next time??

Confused of Sheffield

cj

[Daesul]

My s/a attempt is a horrible blur as I didn't really know what I was doing! But I did get a refund so I think I must have done it right.

Anyway, the thing is, you can only claim that loss once. If you offset it against next year's then that's where you get the benefit of it - next year. If you don't carry it over, you get a refund on it this year. You can't do both, or you will be getting it twice!

[Bath-Bomb.Com]

I think the idea is, that, if you made a loss this year but think you might make a profit next year, you can offset this years loss against next years profit - and spread the pain of your tax bill. When I was working and self employed, I didn't bother carrying the loss forward and usually got a couple of grand (for the first couple of years) in rebate as my loss was offset against the tax I'd paid on my earnings...

It's a mine field but I hope some of that makes sense...

[Curious Cat]

Thanks for your answers, so basically if I offset this year and get a refund, its almost like wiping the slate and starting from 0 next year? Yes it does make sense. I now know why people have accountants lol

You should have seen the trouble I had with declaring my huge (joke) Santander dividend under 'foreign income' It really doesn't seem worth it for £8!!! Arrrggghhh

[AliCat]

Good luck CJ - this is exactly why hubby & I have an accountant to do our tax returns (he is self employed too). Costs a bit more (which obviously you can claim as an expense!) but well worth it in my book. There are things they include as expenses that I would never have thought of (like a proportion of the electricity and gas bills when I am creating at home!)

I am sure once you get the hang of it once it will get easier.

[xavtia]

Have you been on the courses run by the tax office? I've just been on them in my area and they were really useful, although due to the current ecomonic climate they no longer supply refreshments.
It's often easier to deal with questions face to face but someone seem to have forgotten that in the climate of lets make everything telephone help to save money.

You say you have completed the form, did you submit it or did you get to the bit where it tells you what is owed before you submit it?

[bodrighy]

I was going to do mine online as my earnings are way below my expenditure. I got stumped even trying to login as it says I need a Unique Taxpayer Reference and haven't a clue what that is. Is it something i get from the Tax people or something I should already have?
pete

[Daesul]

As far as I recall Pete, you have to register first, then they post you your UTR like a PIN. This way, no one else can log in as you.

Xavtia, I also did the course (coffee was provided!) but when it came to doing the s/a form, none of it seemed very relevant. When I phoned the helpline I had to hold for 10 minutes, then they gave me the WRONG advice. I had to phone again, wait on hold for another 10 minutes, before I got the correct advice.

I wish I could afford an accountant... still, I managed this year so hope I will again next year.

[Curious Cat]

Have you been on the courses run by the tax office? I've just been on them in my area and they were really useful, although due to the current ecomonic climate they no longer supply refreshments.
It's often easier to deal with questions face to face but someone seem to have forgotten that in the climate of lets make everything telephone help to save money.

You say you have completed the form, did you submit it or did you get to the bit where it tells you what is owed before you submit it?

Hi, I've not yet submitted it as I was still deciding if to offset or carry over

[Curious Cat]

As far as I recall Pete, you have to register first, then they post you your UTR like a PIN. This way, no one else can log in as you.

Xavtia, I also did the course (coffee was provided!) but when it came to doing the s/a form, none of it seemed very relevant. When I phoned the helpline I had to hold for 10 minutes, then they gave me the WRONG advice. I had to phone again, wait on hold for another 10 minutes, before I got the correct advice.

I wish I could afford an accountant... still, I managed this year so hope I will again next year.

My UTR was on the letter from the tax man advising me I needed to fill in a tax return this year. When you register with that online you get a login ID and also get to choose your password. You can't actually use the online stuff until you get an activation code through the post a week or so later.

Now that I've done it, it wasn't that bad, but it I think there is an element of muddling through. I did find a PDF help guide which answered some of my questions but not all.

[bodrighy]

Thanks ladies, I need to bite the bullet and go for it. One more question. If you are self employed and your working on a loss, how can you get a tax refund unless you have paid tax? Or is that a stoopid kweschun?

pete

[Curious Cat]

Thanks ladies, I need to bite the bullet and go for it. One more question. If you are self employed and your working on a loss, how can you get a tax refund unless you have paid tax? Or is that a stoopid kweschun?

pete

I'm guessing you get a refund if there is something refund against, so maybe in your case you'd be better carrying it over to the following year?

[Janx]

I'm about to do mine this week!

I attended a local course run my the tax office and found it really helpful, they tell you in simple terms what you can and can't claim for, how to work out a percentage of your household bills towards your business if you work from home etc.

Pete - your unique tax reference number jobby is the number you get when you register as self empliyed to the tax man.

You can't get a tax refund if you haven't paid any tax, if you have run at a loss for the year then you can carry that loss forward onto next years return, if you have made a profit, but not enough profit to mean you have to pay tax on it then you just don't have any tax to pay and no refund either (does that make sense??)

Jan x

[bodrighy]

Thanks Janx, that does clear things. I am hoping to earn enough to afford an accountant...and a secretary, and a packer, and someone to do the sanding for me and the clearing up. OK so we can all day dream can't we?

pete

[xavtia]

Xavtia, I also did the course (coffee was provided!) but when it came to doing the s/a form, none of it seemed very relevant. When I phoned the helpline I had to hold for 10 minutes, then they gave me the WRONG advice. I had to phone again, wait on hold for another 10 minutes, before I got the correct advice.



They have recently seperated the courses into 3, to be able to spend more time, the lady that ran the expenses one was that good that I asked if I could back in the afternoon for the Self assessment online one and she ended up with a 200% attendance because a few other did. I guess the quality of the courses depend on 2 things, how good the person taking it is and how diverse the attendees are. Luckily we we're all in similiar situations even though doing different things and we managed to ask loads of questions between us. Apparently you can go on the courses more than once which is handy as with more experience you can ask more questions. A good question was about food, someone was miffed when she found out she could claim a food allowance for days she could claim for milage allowance. :)

Curious Cat have you been in and changed the form to see what refund you would get if you claimed it this year? Things I would consider are can you manage without a potential refund and are the government likely to remove offsetting, which would be extreme but you just cant tell what may happen.

Daesul - When I was self-employed in the early 90's I ended up having problems with HMRC because of an accountant, I went to the tax office to talk to them about it with a bill for over £1000 and walked out with a bill for £83 and advice to not use that accountant again and when SA was introduced was the last year I had been self-employed I had gone to uni and was lodging with a family who told me the SA was a nightmare to fill in and I would need to see an accountant, the man of the house just happened to be an accountant this scared me but I didn't have money to pay an accountant so eventally I did it myself on 31st Jan that taught me never to leave it till the last minute again but it wasn't nearly as scarey as was suggested

[Curious Cat]

Good point about the chance offsetting could be axed xavtia. I did change it to offset and it does now show a refund so I think I will go for that.

cj :)