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Doing tax return, some advice please (thanks)

(34 Posts)
MUM2BLESS Sun 30-Dec-12 21:49:33

I am claiming for the following:-

W&T
Water rate
Concil tax
Gas
Electric
General expence for c m stuff

(no car expenses as I have been walking)

Never claimed for telephone or mobile expences since I started over four years ago.

Please explain how i can claim contents Insurance and mortgage Interest?

What else can I claim for. Still getting my head around what I can claim for.

Thank you for your help at this busy time smile

apotomak Sun 30-Dec-12 22:04:03

You cannot claim mortgage ... not even the interest. Tried that last year but my accountant said I'm having a laugh grin I was trying it on. It would have been nice to be able to claim it.
Not sure about contents insurance ... we're claiming 10% of wear and tear though.

Muminwestlondon Sun 30-Dec-12 22:12:06

You cannot claim mortgage or insurance unless it is directly related to the business (e.g. public liability insurance). As far as I am aware only the items listed on the HMRC website are claimable. Otherwise you are effectively asking the taxpayer to finance your household expenses and if they are not directly related to the business why should they?

MUM2BLESS Sun 30-Dec-12 22:21:32

Thank you so much.

What happens if you have bills but not the paper form. Some companies do it on line, where do I stand with these?

I think I have been paying too much tax as I have not claimed for some things

Thanks

Muminwestlondon Sun 30-Dec-12 22:32:39

Print off the online bill or statement and keep it with your records, even an email confirming payment should have the relevant date, amount account number etc. Keep your bank statements and invoices/receipts for all bills paid. Keep a record of the basis you have used to work out the apportionment between business and private use and it is good to get into the habit of writing up your income and expenditure records regularly, rather than trying to reconstruct it after the end of the tax year.

MUM2BLESS Sun 30-Dec-12 22:39:54

Thank you for that much appreciated.

Its been busy for me this year. Grabbing the time to catch up on things whilst I have no cm kids.

MrAnchovy Sun 30-Dec-12 23:54:42

You CAN claim a proportion of mortgage interest if you use any part of your home part of the time EXCLUSIVELY for childminding (this means you cannot be looking after your own children at the same time). If you can do this you can usually claim much higher proportions of Council Tax, water rates, service charge ets. as well.

The calculations are not simple though, and I don't recommend anyone does this themselves - you need to get an accountant. Trying to get something sorted before the end of January is not going to be easy so you might need to submit the accounts yourself and pay the tax and then resubmit and claim a refund later: note that any alterations for 2008/9 must be submitted by 5 April 2013.

A proportion of contents insurance CAN be claimed (and buildings insurance too if you are using the arrangements mentioned above). It can be difficult to apportion how much of this relates to your childminding business: HMRC have accepted 10% in some cases, but this is no guarantee that if they inspected you they wouldn't dispute it.

MrAnchovy Mon 31-Dec-12 00:02:40

As far as I am aware only the items listed on the HMRC website are claimable.

This is totally the opposite of the truth - ANY revenue expense can be claimed that is incurred wholly and necessarily for your business (even if it is one part of an expense another part of which is incurred for another purpose, like a TV license for a TV which is used exclusively for your business 40% of the time and by your family 60% of the time) EXCEPT certain expenses, mainly expenditure on building work (other than maintenance and repairs) and client entertaining (which I have never known a childminder do grin).

MUM2BLESS Mon 31-Dec-12 17:21:42

Thank you so much MrAnchovy Are you an accountant?

How much would it be to have an accountant to do my books?

A lady came to visit me from the tax office quite a while ago. She said c m don't really need to use an accountant.

Its not hard to do my tax return its takes time to do it.

apotomak Mon 31-Dec-12 18:22:11

My accountant charges me £250 but it is mate's rates (he's a family member). He's a certified and chartered accountant.

MUM2BLESS Tue 01-Jan-13 19:39:25

apotomak why do you use an accountant? is it because you and very busy or you dislike accounts? (excuse me for asking, just wondering) when do you give the paperwork to your accountant.

I am always looking for ways and means that will help me to do my paperwork etc better.

Thanks for your comments everyone. I welcome more grin

dobby2001 Wed 02-Jan-13 14:33:08

Mr Anchovy, I hold a christmas Party each year for my childminded kids and their parents. This year it cost me over £100 in food, drink, disposable party wear so I will certainly be claiming for entertaining smile

I also use an accountant as I am rubbish with figures so feel happier having someone go over my books and check all is ok. He usually finds extra to claim than I have down. He is based in scotland and can be found if you google childminder accountants. He charges around £100, which of course is offset on your tax return smile

MrAnchovy Wed 02-Jan-13 15:08:20

"Mr Anchovy, I hold a christmas Party each year for my childminded kids and their parents. This year it cost me over £100 in food, drink, disposable party wear so I will certainly be claiming for entertaining."

You can claim for the costs relating to you and to the kids, but not the parents. If you want to claim only what you are legally entitled to claim, one way to do it is to work out how much you are spending on each parent and ask the parents to pay this amount: this is included in your taxable income and so the costs can be included in your allowable expenses. If the party is during working hours you can take this a stage further and not charge parents for childcare during the party, but instead charge them for the party, although they would pay exactly the same amount for effectively the same thing.

HSMM Wed 02-Jan-13 15:34:28

I claimed the costs of my Christmas party. It is definitely a business expense (nothing in it for me and my family). The fireworks were the most expensive thing this year . I am happy to argue my point with HMRC if they disagree.

Italiana Wed 02-Jan-13 18:43:59

An accountant will probably not do your books each week (unless you pay them) so that's up to you to record all expenses incurred for the business, keep receipts and invoices
But they can certainly do your end of year accounts and claim all you are entitled to against tax
The list drawn up by HMRC with NCMA is very limited, I feel it needs an update as does my accountant...there is more that can be legally claimed as your home is your place of work and office

I have had accountants for years and would not do without them while still enjoy doing the basic accountancy tasks regularly I have also learnt the other basics of running a small business!

HSMM...I too would claim for the Christmas party and argue if necessary

MUM2BLESS Wed 02-Jan-13 21:32:14

Thanks very much.

Avuncular Wed 02-Jan-13 21:45:11

I have an accountant I could thoroughly recommend. Worth giving them a ring - they might tell you what you need to know FOC. My accountant Then you could discuss terms with them for what you need.

They are doing my accounts for the first year completely free. Just tell them you got the lead from one of their driving instructor clients

dobby2001 Wed 02-Jan-13 22:12:43

I hold the party at the weekend ,and nobody else is invited aside from a child and parents that has left in the preseding year. It is also the time that parents recieve gifts the children have made for them and the children recieve the gifts I have bought for them. It is most definatly a business event designed to promote goodwill with my "clients" and thank them for using my services. Just the same as it would be if I were any other business.

Cannot see where that is claiming for anything that I am not entitled to - I have even gone through receipts taking off food and drink that was left over and used later on during christmas I am that blinking honest hmm

MUM2BLESS Wed 02-Jan-13 22:45:40

Interesting comments. Is there a limit to the amount you can claim for?

MrAnchovy Wed 02-Jan-13 22:53:03

It is most definatly a business event designed to promote goodwill with my "clients" and thank them for using my services. Just the same as it would be if I were any other business.

And just the same as any other business you are prohibited from including it as an allowable expense by Secton 45 of the Income Tax Trade and Other Income Act 2005.

MrAnchovy Wed 02-Jan-13 22:57:03

*Thank you so much MrAnchovy Are you an accountant?

How much would it be to have an accountant to do my books?*

Yes I am an accountant: I am about to launch a new service for childminders but I don't want to break Mumsnet advertising rules grin

MrAnchovy Wed 02-Jan-13 23:04:17

Is there a limit to the amount you can claim for?

There is no limit to the amount you can claim for a party for the children, but if parents receive any "hospitality" (i.e. food and drink, and any entertainment that is not geared towards children - you could probably get away with fireworks from a tax point of view but from a health and safety/insurance point of view it sounds like a very bad idea), you can only claim the cost of the hospitality if you charge them for it. Or if you put it in your contract.

Like I say there is a very easy way around it which is to charge them for the party but provide them with free childcare equivalent to the same sum of money, and explain you have to do it that way for the tax man.

HSMM Wed 02-Jan-13 23:13:14

Don't worry Mr A. The fireworks were outside and the children were inside (conservatory) with their parents (and my policies clearly put parents in charge of their children when they are present).

MrAnchovy Wed 02-Jan-13 23:16:02

Actually I am going to change that...

Is there a limit to the amount you can claim for?

There is no limit to the amount you can claim for a party for the children while you are being paid to look after them, because that is part of the cost of providing child care, but if you provide any "hospitality" to parents, (i.e. food and drink, and any entertainment that is not geared towards children - you could probably get away with fireworks from a tax point of view but from a health and safety/insurance point of view it sounds like a very bad idea), or to children when you are not being paid to look after them, you can only claim the cost of the hospitality if you charge them for it. Or if you put it in your contract as something they are entitled to receive.

Like I say there is a very easy way around it which is to charge them for the party but provide them with free childcare equivalent to the same sum of money, and explain you have to do it that way for the tax man.

dobby2001 Wed 02-Jan-13 23:19:26

Off to bed, just finished working and cant be doing with games

MrAnchovy Wed 02-Jan-13 23:25:36

The fireworks were outside.

But if one set fire to your neighbour's roof and their home insurer found out it was a business event they may chase you for the cost - and I bet your business insurance doesn't cover fireworks parties.

HSMM Wed 02-Jan-13 23:31:08

Fair point. Hid the families inside ... so defo not a business event wink

MrAnchovy Wed 02-Jan-13 23:47:39

Sorry dobby2001, have I said anything that has offended you?

Italiana Thu 03-Jan-13 12:34:25

Mr Anchovy: your new service has been advertised elsewhere in another c/ms forum, or at least you have given us the link to, and it is something that many c/ms know is in the process of being launched, according to the govt forthcoming proposals, not just by you but many other bodies who see what this govt is driving at...I won't say the word but I doubt I am wrong???

As an accountant you are also fulfilling E Truss' wish that c/ms find someone to deal with their business side of things as many have declared themselves unable or unwilling to deal with the running of their business (something she reinforced on 4 Dec at the conference I attended)

As a c/m I continue to encourage colleagues to be as independent as possible in running their business, maybe looking at having an accountant that advises, does the end of year tax return and points to the many expenses that we can legally claim...had I not done that so much would have gone unclaimed

MrAnchovy Thu 03-Jan-13 14:03:07

Italiana I think there are actually four different things:

1. An accounts and tax service supporting individual childminders

2. A business administration support service supporting individual childminders on a "pick and mix" basis - contracts, billing parents, collecting money, food hygeine and other non-childcare regulations, policies and procedures

3. Administration related to EYFS (in England and Wales) and other child care standards supporting individual childminders

4. Delivering childminding through an agency

On this thread I have only been talking about 1.

I have spoken to you and on other (closed) forums about my plans for 2 as well but that is not what I am talking about here. This is what Liz Truss is talking about though.

There are already a number of providers of solutions to 3 in various formats (paper, PC based, online).

4 is crystal ball gazing and until we know if/when/what it will look like I have no plans.

It seems to me that Liz Truss was appointed on the back of an implied promise that there was an achieveable solution to the issue of affordable childcare and that she would sort it all out. It is now clear to everyone, including her, that there isn't and she can't. I don't think anyone can predict where we go from here, least of all Ms Truss.

MUM2BLESS Thu 03-Jan-13 20:29:52

Thank you everyone.

I know I am not claiming all I need to claim for.

Have you got a website with what you will be doing for childminders. I hope I do not get you into trouble. Just wondering.....

Italiana Sat 05-Jan-13 10:55:37

Not long to wait now Mr Anchovy as E Truss is now ready to respond to the Childcare Commission

Mum2bless The wait is coming to an end. After Truss's response we will all discover how many agencies/social enterprises or whatever have been set up and awaiting the green light to go

MUM2BLESS Sat 05-Jan-13 12:06:57

Thanks for that

MUM2BLESS Tue 22-Jan-13 20:58:12

Started the online tax return process. Business Tax Dashboard

Would you like to enrol for the Business Tax Dashboard? its asking, do I need to select yes? (sorry if its a silly question, just double checking)

I am a childminder.

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