So, Christmas is done and we’ve even had New Year. We trust that you enjoyed yourself, recharged the batteries and that you’re now primed and ready to tackle to 2022. We certainly are here are at Mountain Top Accountants.
The only slight issue with the Christmas festivities is the realization that when you come back to work in January, those that are self-employed individuals will be facing an HMRC Self Assessment deadline. But whatever you think, it doesn’t have to be daunting. In fact, it’s actually an opportunity to save money, if you know what you’re doing.
Now, this is where we explain that if you don’t know what you’re doing then the best thing is contact us here at Mountain Top Accountants as we believe that our experience and knowledge could legally save you a significant amount of money. We make sure that you claim for the right allowable expenses at the right time and reduce your tax liability as low as possible.
With us, it’s not just about getting your accounts filed on time and saving you a penalty payment, it’s more about making sure that you claim for every penny that you’re allowed to. If you ask us honestly, too many tax returns ‘under claim’ in some way, which means that tax savings are out there to be had.
It still makes us laugh out loud that The Simpsons character Ned Flanders, once refused to claim for printer ink on his US tax return because ‘he liked the smell of it’. So, if you’re not like Ned then read on as we have a few tips for you.
Because it still feels like the season of good will, we thought we’d give you a run-down of some of the lesser known, but perfectly allowable expenses that you may be able to make.
1.Office supplies such as mobile phones, printing cartridges, laptops (dependent on usage) and business software are all allowable expenses and in some instances, can make a major difference to the profit you make and subsequent tax you’re liable for.
2.Most people understand about mileage expenses at 45p a mile for the first 10,000 miles when using a private car. However, in some cases it may be advantageous to claim the business proportion of all the motor expenses; fuel, servicing, insurance, breakdown cover and even interest on the loan to purchase the vehicle. We can help you work out which is best. Don’t forget about claiming for parking and even hotel rooms when travelling for business.
3.One of the most overlooked allowable expenses is Unpaid Invoices or Bad Debts, which means you to claim for invoices that you know will not be settled for whatever reason.
4.Clothes is another often overlooked one. Don’t be tempted to claim for absolutely everything in your wardrobe but anything that you need solely for work is acceptable and not just uniform and safety wear, suits possibly count as well, so long as they’re specifically needed. Alternatively, get everything branded with your logo and voila!
5.When it comes to mortgage payments and utilities for those of you that work from home, you must be careful. The general rule of thumb is that if you have a single office in a five room house then 20% of your utilities could be allowed as well as 20% of mortgage interested payments or rent. Just bear in mind that this can be tricky as Capital Gains could kick in if the property is subsequently sold. Our advice on this one is get some professional advice.
6.Like Utilities, Council Tax can also be apportioned in the same ‘fair and reasonable’ way. If 20% of your home is an office, 20% of your Council Tax could be allowable, but again best to seek some advice on this, especially if your office is also a spare, occasional bedroom.
7.Subscriptions to professional bodies or trade publications could be allowable as are certain television packages (dependent on the type of work you do). If you’re a freelance sports journalist then it’s likely legitimate to claim for your Sky Sports package, but probably not if you’re a plasterer.
8.Charitable donations are a good way of reducing your tax liability. If they’re made to a registered charity then some of that donation is tax deductible, dependent on how it’s been made.
We started Mountain Top Accountants for a number of reasons but probably the most important one was that we wanted an accountancy firm that was different to everyone else out there in the South-West. Modern day accountancy has so much more to offer and if you ask us honestly, getting a decent accountant is one of the best business investments that you’ll ever make.
So, if you are interested in talking to us at Mountain Top about reducing your tax liability, then please feel free to contact us on 01752 914214 and remember, very few people get to the top of the mountain without any help.
