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Hi, Im in part-time employment and self employed, I also…

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Hi, I’m in part-time employment and...
Hi,
I’m in part-time employment and self employed, I also have income from property (furnished) and from letting a room in my house.
Questions:
1.Have expenses relating to the part-time employments, can it be claimed.
2.After an accident I bought back my car from the insurance company for £100 (claimed 50% on capital allowances), 5 months ago I lease a new car, got £2000 (scrap page scheme) for the old car and paid an extra £1500, so advance payment of £3500, my monthly payment is £234.50. The car is used 50% for my self-employment job. What amount can I claim?
3.What effect would it have on my allowances for tax purposes if I had purchase one rather than leasing one?
4.I was told to submit my tax return to HMRC I could use a different form, please explain.

Ron
Submitted: 8 years ago.Category: UK Tax
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Answered in 7 minutes by:
6/17/2010
UK Tax Professional: Tony Tax, Tax Consultant replied 8 years ago
Tony Tax
Tony Tax, Tax Consultant
Category: UK Tax
Satisfied Customers: 16,000
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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Can you tell me what you do in your job or jobs as an employee and on a self-employed basis please. What expenses have you incurred in connection with your work as an employee and why haven't these been repaid to you by your employer? What are your annual earnings from employment and self-employment? You say you have leased a new car but you got £2,000 for scrappage of your old one. At the end of the lease period will the car be yours? What is the payment of £234.50 made up of? The lease agreement should tell whether the payment is pure rental or a lease purchase payment.
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Customer reply replied 8 years ago
  • 1. Part-time job work for a cosmetic company, annual earnings £4500, the incurred expenses was £ 650 for travelling and £ 150 Make-up, they said I should try to claim it thought my self assessment return
  • 2. Self-employed work as a model, annual earnings £36500
  • 3. It ‘s a Hire -Purchase agreement, Amount of credit £14260.01

Duration of agreement 48 months

Total amount payable £21685.50

APR 9.5%

First repayment £408.50

Followed by 46 monthly repayment each of £234.50

And an Optional final repayment £ 6990

Cash price of the vehicle £ 17760.01

Advance payment £ 3500

Total charge for credit £3925.49

 

  • 4. Income from rented room at home £4500

Ron

UK Tax Professional: Tony Tax, Tax Consultant replied 8 years ago
Thanks.

1 You should be able to claim the travel costs against your earnings for the cosmetics company as long as they were incurred for travel around the country as opposed to a single place of work. As far as the make up costs are concerned, it's not clear whether this was for your use or for use in demonstrations. If it was the former, you probably won't be allowed it as a deduction but there is no harm in trying.

3 As you have effectively bought the car, you can claim capital allowances on the cost of the car excluding interest charges which would appear to be £17,760. The rate of the annual allowance is determined by the CO2 emissions of the car. For cars with emissions of 110g/km the allowance is 100% of the cost of the car so you can write it off in one year against your income. For cars with emissions up to 160g/km the allowance is 20% of £17,760 in year one, 20% of £14,208 (£17,760 - £3,552 x 20%) in year two and so on until the whole cost has been written off. For cars with emissions over 160g/jm the allowance is 10% of the reducing balance. As the business use of the car is 50%, the allowance is halved for each year.

You will also be able to claim 50% of the car finance interest payments as an expense against your self-employed earnings.

4 If you only receive rent from letting a room in your home as opposed to that from another property then you can claim exemption for the first £4,250 under the rent a room scheme which you can read about here. You cannot claim expenses if you use the rent a room scheme.


Edited by Tony on 6/17/2010 at 2:22 PM EST
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Customer reply replied 8 years ago

Hi, What about the two last questions:

3.What effect would it have on my allowances for tax purposes if I had purchase one rather than leasing one?

4.I was told to could submit my tax return to HMRC by use a different form , please explain.

Ron

UK Tax Professional: Tony Tax, Tax Consultant replied 8 years ago
3 You are buying the car. It's on hire purchase. As well as capital allowances you can claim the bsuiness element of the car running costs such as fuel, insurance, MOT, servicing, repairs, road fund licence etc.

If you lease a car (which you don't own), as long as the CO2 emissions are 160g/km or less then you can deduct 100% of the lease rental payments with a disallowance for private use. If the emissions are over 160g/km then you can deduct 85% of the lease rental payments with a deduction for private use. You can also claim the running costs that you pay. Some of them such as servicing and insurance may be covered by the lease rental payments.

4 I don't know what you mean by a different form. There is only one tax return. Who told you about a different form? The only other way to submit your tax return is to do it online which you can find out about here.
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