Tools Inland
Tools Inland
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 inland glass strip circle cutter combination toolmake life easier  US $13.99
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 Inland FlexShaft Flexible Shaft Tool US $40.02
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 NEW INLAND STAINED GLASS STRIP AND CIRCLE MAKER TOOL US $35.00
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What can I claim for on my Tax return?
I make cakes from home and my profit is very minimal. I'm getting a bit worried about filling a tax return as i dont know what i can claim for. I've had to buy loads of equipments such as tins and tools and had to have more cupboards put up in my kitchen, can i claim for some of that? Also what about internet and phone/mobile phone? Without these I wouldnt be able to run the bussiness as its the only way for ppl to contact me. And stationary? I'm assuming i can put things like advertising and insurance in? What about courses and trade shows? I''m finding very hard to work out what "profit" i am making on each cake as they are all individual and i dont know how much things such as gas and electricity are costing. I've tried to ring the inland revenue for advice but they were useless, told to look on the website but it doesnt explain these things on there.
Any advice would be very much appriciated, thanks
Its not that complicated really. You know your sales, so that side of the account is complete.
As for expenses, there are two types, Revenue and Capital. Revenue are the bits and pieces that are used up in the making of the cakes and the expenses of selling them. So you will have flour, eggs etc. A portion of your electricity bill, paper cake wrappers and similar. Then you have the associated running cost of selling your cakes, telephone, internet, advertising, insurance, delivery charges etc. Remember if you are working from home that only the percentage of the telephone, electricity and internet will be allowable against your income, because you have personal use of these items also.
Capital Expenses relate to equipment for use in the business like industrial mixers, ovens etc. If all you actually have purchased are some tins and tools, I would personally include them as revenue expenses as the value is low and the residual value will be nothing. Depending on the value of the cupboards they probably would be a capital expense, but be careful here. Strictly speaking, to qualify they should be for business use only, not very likely in a domestic kitchen. When you have added up all the revenue expenses that is the other side of the account. Subtract the expenses from the sales and you find the nett profit and that is what is taxable. Should the expenses be more than the sales (possible in the first year) then you have made a loss which you can either offset against any other income in that tax year or carried forward to reduce future profits. If you get tied into knots e-mail me