Self Employed - Allowable expenses - ADSL?

  Sir Radfordin 23:09 10 Aug 2006

Just remembered I'm supposed to do one of those pesky tax returns as I'm registered as self employed - for the minimal amount of 'extra' IT work I do. So just about computer related...!

Anyway, the work I do requires an internet connection - just so happens to be ADSL. Anyone know how the tax man would treat that as an allowable expense?

Obviously I use the connection for more than just 'business' so is the logic you only claim a percentage for the business? If so...what?

Any thoughts?

  ade.h 13:17 11 Aug 2006

Quote "a very helpful customer service helpline".

Pity the poor accountants are getting passed from pillar to post these days then! If I'm visiting my parents, I often hear mutterings from the study along the lines of "...blood from a stone".

Sir Radfordin - normally, you would be okay with this one, provided that you can justify its need. But as it's a sideline, it may be seen as non-essential. With conventional businesses (where it is the primary or sole income) it's generally quite easy to claim offset for things like that.

I might ask my dad when I next speak to him and find out what he thinks.

  spuds 13:59 11 Aug 2006

ade.h-- I can only go on my involvement about three months ago. Okay, I visited my local tax office, who seems to be undergoing major refurbishments again. They in turn provided free telephone access to the IR helpline based in Glasgow. Original advisor wasn't sure of my problem, then passed me to a more senior level. Result, perfect advice and information given in a very short time.Yes it took a little time initially, but I got what was required in the end, and that was the main thing.

I do believe though, that the IR and Customs and Exercise are now forming a merger plan. This in turn may prove to be another governmental decision failure in the long term?.

  ade.h 14:30 11 Aug 2006

It's getting really quite bad now, from the accountant's point of view. They have to go through different channels, of course, but the system has been mucked about, staff have moved on or been made redundant, direct phone lines have been closed, so you can never speak to the same person, and so on.... Our local office is in a right state at the moment, and the staff openly admit as much.

  PurplePenny 15:07 11 Aug 2006

... we have for the small businesses

You are so right. On the one hand we are told that government encourages small business (and e-business especially) whilst in the other hand various government departments are making it difficult for small businesses to function!

Any minute now Adam is going to start telling us to get our tax returns in... ahhhh!

  ade.h 15:34 11 Aug 2006

Who's Adam?

  Sir Radfordin 00:40 12 Aug 2006

A valid point no doubt - I would however claim that an internet connection is fairly essential when providing 'remote' IT support and web design.

...but when did common sense and logic ever play a part?

  daisy2bell 21:49 12 Aug 2006

The answer is yes, but as you also use it for personal use, you can only claim a proportion of it.

  ade.h 23:23 12 Aug 2006

Hi Sir Rad.

I've spoken to my Dad and outlined your situation. He recommends that you can legitimately offset a large proportion of the cost due to the specific nature of the support work; 80% is the figure that he suggests in order to avoid having it questioned. If you were to claim 100%, they would almost certainly query it on the grounds of mixed use, like they would with a home phone line or fuel for a multi-use vehicle. Hope that helps.

  Sir Radfordin 00:25 13 Aug 2006

Sounds like a good plan! Many thanks (and to your Dad also!)

  ade.h 14:17 13 Aug 2006

No problem! As he said to me - and I have found this also - there can be a bit of haggling involved sometimes, but if you try to claim 100% you tend to get short shrift from them.

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