How do you work out how much tax to pay?

[LoveMyGirls]

Just trying to work out how much i could earn per year, i know the chances are it will change throughout the year but im just curious, thanks

The general concensus is that you only declare 1/3 of your total income to tax office! Obviously sometimes its more and sometimes its less, there are VERY good deductions for childminders with regards Tax. This generally means that you rarely come in above the tax bracket unless you are full all the time! Hope that helps

Start off with how much you earn (weekly? monthly?)

Then work out how much you spend on CMing expenses (per week? per month?)

Take one from the other and you get your profit (or loss)

1st yrs turnover 10K loss £800
2nd yrs turnover 20K profit about £6000 (therefore Tax about £150)
3rd yrs (haven't done any yet)

You can do it as you go or in a lump at the end of "your" year my year runs april to March as it is easier to work out

CAT me if you need any more help
KMc

Katymac - does that mean turnover was 20k but 12 k of it was business expenses. It seems alot. Or is it that Im a bit thick?

Yep

It is quite a lot

But my small business advisor filled in my tax return & kept asking for more figures (for other stuff I hadn't intended to put through - the largest amounts were for food, petrol and fixed costs - like heating etc)

& she works for the IR

How did you get a small business advisor?

Phone the tx office and asked for help - she came within weeks of me starting and phone every 3 months and I made an appt to get my tax return filled in by her

I'll do next years by myself (I think)