claiming expenses and adjusting (for future reference)

flogen

I'm going through the process of filing my taxes (as a self-employed freelance journalist) and noticed some of the expenses that can be added such as travel expenses.

I've no way to document any such expenses for last year so I can't claim them now, but for future reference can I add these as a self-employed person (not registered for VAT) and what else could realistically be added (phone bills, rent etc.?)

Just want to know what I should start keeping proper track of now for upcoming years.

Slightly different question - while using the ROS service I was sorting through the "accounts extract" section, part of which asked me to detail any loans or overdrafts I had at the end of the period in question.
At the time I would have owed an amount in a loan so I'll put that in, but can I then deduct this amount from my gross income for the year? So let's say I had 10k in earnings and a 5k loan, are my adjusted net profits 5k, or does the loan etc. make no difference to the adjusted amount?

Bren1609

The rule is if it's "Wholly and exclusively for the purpose of the business" it's allowable. Regarding ESB, phone etc usual treatmtent is to put the whole amount thru and addback a percentage thats personal.

Your suggested treatment of the loan is wrong. What was the loan for, is it a business loan?

flogen

Bren1609 wrote:

The rule is if it's "Wholly and exclusively for the purpose of the business" it's allowable. Regarding ESB, phone etc usual treatmtent is to put the whole amount thru and addback a percentage thats personal.

Your suggested treatment of the loan is wrong. What was the loan for, is it a business loan?

Thanks for that.

As for the loan one could probably be deemed business (was for a new computer) and the other was college related, and while it was a degree in my chosen career I doubt it would count!

I'd be surprised if I could claim a loan back on my profits but just want to check to make sure.

information

flogen wrote:

At the time I would have owed an amount in a loan so I'll put that in, but can I then deduct this amount from my gross income for the year? So let's say I had 10k in earnings and a 5k loan, are my adjusted net profits 5k, or does the loan etc. make no difference to the adjusted amount?

A loan is not used againist calculatng your income

flogen

information wrote:

A loan is not used againist calculatng your income

Thanks - good to know these things for certain.

JoeTurner

The interest paid on the loan is allowed as a deductible expense for taxation purposes if the loan was used wholly and exclusively for business purposes.

Ask your bank for a loan schedule if they haven't given you one already - this should give you the interest amount paid as part of your repayments

Joe

ircoha

flogen wrote:

Thanks - good to know these things for certain.

however if the loan is related to the business then the interest u paid to the bank on the loan is allowed as an expense.

the other 'no-no' is if u say buy a laser printer or computer, the temptation is to write it all off against tax in one go: that is verboten: in ur financial accounts it is written of over a period of time via depreciation and in ur tax accounts by way of capital allowances:

flogen

ircoha wrote:

however if the loan is related to the business then the interest u paid to the bank on the loan is allowed as an expense.

the other 'no-no' is if u say buy a laser printer or computer, the temptation is to write it all off against tax in one go: that is verboten: in ur financial accounts it is written of over a period of time via depreciation and in ur tax accounts by way of capital allowances:

So if I bought a 1k PC for work, for example, I wouldn't write that off as a 1k expense there and then, but instead would put the depreciation of its value down on each successive accounts (so let's say it's worth 100 less per year, I put 100 down in depreciation every year)?

Man - I really wish I could afford to have someone do all this for me!

ircoha

flogen wrote:

So if I bought a 1k PC for work, for example, I wouldn't write that off as a 1k expense there and then, but instead would put the depreciation of its value down on each successive accounts (so let's say it's worth 100 less per year, I put 100 down in depreciation every year)?

Man - I really wish I could afford to have someone do all this for me!

Yes that is the idea except for a printer u would prolly write it off over 3 max 5 years in your financial accounts accounts.

I need to check re capital allowances but I think it is 12.5% per annum, perhaps some one will correct me please.

This stuff is not hard once you do it the first time. You are not accounting for General Motors, it is I presume all euro based so not hard with one currency: where are u based in relation to North county dublin?
I ALWAYS advise people to understand how it works- else u risk being done!

Why do u say u have no way of billing certain expenses for last year: were they all cash, no CC?

flogen

ircoha wrote:

Yes that is the idea except for a printer u would prolly write it off over 3 max 5 years in your financial accounts accounts.

I need to check re capital allowances but I think it is 12.5% per annum, perhaps some one will correct me please.

This stuff is not hard once you do it the first time. You are not accounting for General Motors, it is I presume all euro based so not hard with one currency: where are u based in relation to North county dublin?
I ALWAYS advise people to understand how it works- else u risk being done!

Why do u say u have no way of billing certain expenses for last year: were they all cash, no CC?

Yes, I'd much prefer to do it myself - just need to get my head around it and I'll be fine.

I mean, I'm not even sure what you mean by capital allowances or if there's a difference between me filing an F11 and my financial accounts that you refer to! (Can you recommend any easy-to-digest literature to get to grips with this?)

My situation is simple enough; I'm self-employed and get invoiced for anything I'm paid for (or have been so far, anyway), have no staff etc. so don't have to worry about any of that jazz.

As for my expenses most are probably unaccounted for (for example my means of travel would be public transport and I have a tendency to chuck receipts) although I will check through my DC to see if there's anything there..

I'm based in D9, by the way.

ircoha

Use ROS as u can save the work as u go along, use the online help and post any questions u have here, if I am not online PM me.: it is a very simple business u have so not hard to do.