Hello. Some Background: I created and built a website…

Hi

No, you cannot claim those expenses (part of accommodation, laptop, travel costs) unless the income is deemed to be a trade, which it wasn't, and HMRC will not treat it as such, so this will have to be absorbed by you.

So it makes no difference whether the expenses were incurred the same or a different year.

The second one I am afraid you cannot claim anything for, as it did not result in a sale, and had it done so, also would have been treated as a capital gain.

Just a note, you should not have registered as self employed, as you do not advise that you traded or made money from this website, so you had no self employed income, so let HMRC know, this was registered for in error and there is just the gain to consider.

If you did in fact earn money from the first web build (other than its sale) then let me know as the expenses may well be allowable, and I can advise how to take this forward as then it would be right that you registered as self employed.

Thanks

Sam

Hi

Then that changes matters and yes you were right to register as self employed.

So for the tax year you just were trading earning money, then you declare the income you earned from Google Adwords

From this amount (for the tax year 2011/2012) you then claim the actual expenses incurred, so the travel, the laptop - and you can claim £3 a week for each week you traded to 05/04/2012. This income and the expenses will be declared under the self employed (personal income part of the return) and as you did trade then claim the money you paid for the help in building the website.

Then for 2012/2013 you have income earned from google adwords and all the expenses for this and the second build website, so part accommodation £3 for every week you traded, and also travel expenses. And you also should claim the help you received to build the second website as well.

Then you also have to declare the capital gain, which will be the £20K less any legal fees to sell ( which also will go on the 2012/2013 tax return, as this the tax year the site was sold.

If you wish me to undertake tax calculations for you then please note that as this is additional work then please do consider a bonus for the additional work.

Please then also advise

1) How much money you made from selling adwords and break this up from the date you started to trade to 05/04/2012, and then the period 06/04/2012 to the date you ceased trading

2) Also split how much you spent on expenses - so travel for each tax year - how much the laptop cost, and how much your internet connection was (and the % split between business and private use)

4) Whether you had any other income for each tax year.

Thanks

Sam

Thanks

Sam

Hi

No I am afraid not - as it all falls within the remit of a capital gain transaction as it was the selling of the asset itself.

Thanks

Sam