I worked freelance from May to December last year. I've just gone through my accounts and I earned £12,000 from it. I went back to standard employment in January so have been on PAYE since then.
A local accountant said it would cost £250 for him to submit my return for me - but since I only earned 12k, I'm wondering if it's worth it? But if I do it myself, I'm not sure what expenses I can deduct?
He mentioned business equipment (eg cost of laptop/printer/desk etc) - so I can estimate that. He also said I would deduct a portion of heat/lighting etc to cover home office but what kind of proportion?
I bought a new car in June - is any of that tax deducatable? I've looked online and I can find guidance but it doesn't go into much detail.
I probably have a few hundred pound of business expenses (paper, petrol etc) that I can easily work out/deduct - it's the other things I'm not sure about - can anyone help? I'd really rather not pay the accountant - because I'm now on redunancy notice so every penny counts in the run up to christmas, and I'm thinking I probably owe very little tax anyway becaus eof my earnings?
A few points. Your tax return has to include all your income for the tax year not just freelancing income. So combined with the employment income your taxable income is probably quite significantly over the personal allowance.
NI cannot be deducted from your business income, it's a personal cost, not a business cost.
Your car and other capital items are complicated. You can include them and treat some of it as business expense but as your business has now finished you are deemed to have 'bought' them back from yourself at market value in December. There may not have been a big reduction between may and December. Additionally, if you used the car (or other assets) for non- business purposes then you need to apportion between business and non-business use. So if the car was bought for 10k and in dec it was worth 9.5k but during the time your business was working you used it for private driving 70% of the time you can only deduct £500x30%=£150.
Same sort of private use adjustment for any other business expenses, car insurance etc.
It's not easy if you've never looked at it before so I would think 250 (should be deductible) is an ok amount to pay to get someone to sort it out for you. You may also have to remember things like reducing your payments on account (maybe, depending on our circumstances) so for a one-off I think it's worth it.