Sole trader tax return - I pay office rent, parents cover the cost. How to declare?

[DoggRadio1]

Hi all,

I have a question regarding tax returns

I am a sole trader. I have moved into a nearby co-working office space part time and pay a small fixed fee per month for this. My parents are kindly paying the office fee while I get my business set up.

They transfer the money to my bank account the day before the office rent is due. I pay it out of the account the day after.

I was wondering what the best way to address this on a tax return, if at all, is. It’s not earned income - I suppose it’s best described as a gift which is used to cover business expenses. In my bank statements it is pretty obvious - the exact amount for the office rental comes in from parents, and goes out to the office.

Do I need/should I declare the money from parents in the income bit, or the outgoing bit as an expense? It seems like a grey area.

It's not a grey area. If it's a genuine gift from your parents, i.e. they get nothing in return, then it's not declarable income. Assuming the rent payments are wholly and exclusively for business purposes, then they're a legitimate expense.