Tax return expense help please

[crackerjiller]

I'm panicking now as the deadline is so close. Struggling to find professional help.

I'm a self employed carer. I need to do my tax return for 6 months of work. Stupidly thought I could do it myself but I'm getting so confused over the allowable expenses. I've talked to other carers who contradict each other and I end up in a spin.

Please could you list allowable expenses I can use as a carer. I'm confused about the car expenses and mileage. Council tax. Time doing invoices. Someone said I could put a percentage of what my car is worth.

I am trying to find an accountant but obviously it's their busiest time.

Do not believe anything people say about what they do and do not put on their tax returns, most of them are either talking crap or doing their returns wrong. Look everything up on the gov.com websites they are quite good at explaining things. Do your best with the info you have and get something in before 31st Jan. Then if you are really worried get a tax advisor to take a look in February when they are not so busy.

The problem is people don’t fully understand what their accountant is doing. So they’re telling you snippets and it’s confusing because you don’t know which bit of advice will be right for you.

Your friend that is putting 6% of their car value through could be right. They’ll probably be claiming capital allowances. Which is completely different to claiming mileage which is also completely different to claiming a business % of motor expenses.

a good accountant will have a meeting with you, discuss your income and what you think your future income will be and will prepare your accounts accordingly.

The devil is in the detail. What is allowable for one person may not be allowable for another if their circumstances are slightly different. Re the first and last journeys of the day, if you were an area-based employee, in other words one whose employment duties are specifically defined by reference to an area, even if you must attend different places in the area in the course of your job, the area could be regarded as a permanent workplace and travel costs to and from your home and inside the boundary of that area would not be allowable. So it may well be determined by personal travel patterns and where the clients are living compared to the carer, ie if the patients really are scattered in all different directions and locations, and each day is different, then probably all allowable, but if all patients are say in village b but the carer lives in village a, then travel between villages a and b may not be allowable. With tax, the exact circumstances always matter. That’s exactly why different people say different things.

Exactly. There is an element of Samadian that's relevant, but not the bit some people think it is. The ruling disallowed travel to locations between which Samadian was operating clinics. But very specifically allowed for the home visits.

If Samadian was to be applied as broadly as some here are suggesting whole swathes of employment (and more importantly, self-employment) would be denied travel expenses when visiting clients.

If you are self employed you can claim from home. It's different if you're employed and have a "base" somewhere else.

In your circs I would really not overthink this - lots of people are trying to be helpful here and posting things which are not strictly relevant to you.

Just set up a Google sheet with your income (everything you got paid during the 6 month period, dated the dates it came into your account) in one column. Total this at the bottom of the column.

In the adjacent column list out your expenses - ideally by date, but if you only have a total eg. for mileage, just add that at the bottom x by 45p per mile. This is where you put things like PPE, covid tests, iPad if just for work, professional registration, training costs etc. Total this column at the bottom too.

When you go onto HMRC self assessment (have you already registered? They have to post you something out I think so don't leave it until the last minute), you'll be asked for the total in column 1 (your income) and the total in column 2 (your expenses). You won't be asked for any proof - your spreadsheet is the proof in case they ask for it, but they almost certainly won't.

You can amend a return later if you think you've done it wrong, but to be honest I suspect at your level of income, whether you are or aren't claiming some small parts of expenses will make very little difference. Were you also employed? If the 8k over 6 months is your only income for the period you won't pay any tax anyway...

@crackerjiller You can always ring HMRC/your local tax office and speak to someone there who will be able to answer all your questions. I've always found them to be really helpful when I've been doing my tax return and haven't been sure about something

If I go with the car expenses method instead of mileage can I use car repairs as an expense? My tyre was stabbed at a visit to one client and my car has a eco boost engine so I recently spent £1200 changing the wet belt in hope that that will safe the engine (that's another story) it was a preventative measure.

*save not safe

Well…. It gets a bit complicated because if you’re using your car for private and business use then obviously you can only claim a portion of repairs.
But honestly, at the figures you’re talking about just include it and if it’s questioned later then have the discussion!

My understanding has always been that if it's your own car these are not allowable expenses and that it's just the mileage at 45p per mile

Also - is this your only income?? Because if so, you're not going to pay tax anyway and you could put through no expenses at all and it won't change things. All the expenses do is reduce the portion of your income which is taxable.

When completing the tax return is there also somewhere to pay national insurance?

It will calculate NI as part of your tax liability. If you earn under the threshold you won't pay NI though.

So I've found a tax calculator on the gov website but it's to calculate for the next tax year 24/25 but I've put my numbers in anyway to get an idea and tax and insurance will come to £2219.03

I actually had earned more than I thought and I've included earnings from a job I had before becoming self employed. I got that number off my P45. So now I know what has come in, back to trying to work out what went out.

I have paid for shopping for some clients and I invoices them separately for this but get paid by cheque into my bank like I do for their care. I haven't included this as income because it isn’t income but do I need to list these payments and what they were for somewhere?

In the tax period 23/24 I drove 3847.3 miles visiting clients. So I need to work out if I spent more on that or car expenses?

Looking at car expenses instead of mileage. I was self employed for 8 months of the tax year so do I divide for example my car insurance by 12 then multiply by 8. I only use that car for work.

If you want to do a % then you will need to work out what % or hours per week you use your car for business. This % is then used for the costs. For a personal car used for business you would usually do the p per mile (value in hmrc). Either way it's one or the other & remains the same every year while you have that car. It might be better to do milage if you do a lot of driving. Trying working out an approximate for both per week & see.

Business phone - yes

Ppe - yes

You don't need to send proof to submit but you could be asked for it if inspected. People "get away" with claiming expenses because they haven't been audited. It doesn't mean they are allowed. Allowable expenses are noticed on the gov website

Shopping - you could declare the cheque as payment then shopping as an expense to show it wasn't earnings

Get an accountant OP. Mine has just filed my tax return. She goes through everything I send her and from that calculates allowances for travel/training/sustenance/insurance etc. I gave her all the bits on 2/1/25 and its done already. I submitted paperwork/details late (poorly organised/holiday in Dec) despite her being really good and reminding me throughout the year what was required from me!

I know I could not have managed this myself. Her fee was very very reasonable (would happily have paid more!) and I have peace of mind that its done. An accountant upthread has already said pay the late fee and get it done properly. That's what I would suggest.

Do mileage. It's easier and there are less complications.

If you invoice for the shopping you include it as income. But it will be balanced by the payment you receive so it won't affect your income tax (but would count as turnover towards VAT, but I doubt you're turning over £85k to worry about that).

So for example I bought an iPad for £500 I will get 20% back?

Only if you'd be able to prove if challenged that it was an expense wholely and necessarily incurred for business purposes, any personal usage is minor and negligible compared to business usage, and you didn't claim the £1000 tax free allowance mentioned previously. But if those conditions all fulfilled then yes.

For this year it's probably worth taking the £1000 flat rate as it is a lot easier for you

You don't get the actual amount back, it just becomes tax deductible.

You don't get anything back. You just get £500 or whatever % of £500 can be attributed to use in your trade deducted from your profits and therefore pay less tax on your profits.