Tax Return

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    Tax Return

    Does anyone know of any good online tutorials/guides for filling out your self-assessment tax return? I don't know about you's but I hate filling out forms (they always ask you to tick a box to say the information you've put in is correct too!!)!

    This is my first year filling out the self-assessment tax return for 6th April 2019 to 5th April 2020.

    Any guidance would be appreciated.

    "Total Rents and Other income from property:" - On the Gov.Uk video it mentions Total Property Receipts - Expenses and deductions = Profit from property income... so if for example the rent is £500 but management fee for letting agency is £60 and I had repair for washing machine of £60 on the statement also (letting agency got repair man out. Also if I do repairs myself - do I add this as expense? How do i prove this or do I just hold onto receipts for items purchased such as paint at B&Q?) Is the total for this month for rents and other income £500 or £380??

    Like why can't they just ask simple questions like how much did you earn? What expenses did you have? Total profit? etc??

    If i'm understanding the video HMRC has on youtube (it then goes on to explain I must state Gross income to HRMC?) my understanding is I must total up all the £500/month so if paid rent for 11 months (1 falls outwith 6th April 19 to 5th April 2020 tax year for would be following years tax) the answer to this would be £5500 then I claim letting agency management fee (£60/month) and repairs in another section on the form (allowable expenses)??

    #2
    Originally posted by Brian862107 View Post
    Does anyone know of any good online tutorials/guides for filling out your self-assessment tax return? I don't know about you's but I hate filling out forms (they always ask you to tick a box to say the information you've put in is correct too!!)
    I get an accountant to complete my tax return.
    It costs, but it's an allowable expense and it's worth it just to know that I'm keeping the tax I pay to a minimum.


    "Total Rents and Other income from property:" - On the Gov.Uk video it mentions Total Property Receipts - Expenses and deductions = Profit from property income... so if for example the rent is £500 but management fee for letting agency is £60 and I had repair for washing machine of £60 on the statement also (letting agency got repair man out.
    You are taxed on your net income (which is rent less expenses - like the management fee and repairs), but you don't put them on the form like that.

    Your income is just the income and the expenses are recorded somewhere else on the form. On my last return, the income went in Box 20 and the expenses went in boxes 24 through 29.

    Also if I do repairs myself - do I add this as expense?
    You can't treat your own time as an expense. You're running a business and are expected to do some work!

    Like why can't they just ask simple questions like how much did you earn? What expenses did you have? Total profit? etc??
    Your business is small and fairly simple so that would work for you - but it wouldn't work for other people with more complicated tax affairs.

    You need to keep as much evidence as you would need to prove the figures if HMRC ever challenge them (which is a possibility so remote that you can probably ignore it).
    You keep records for seven years after which time you're pretty much free from being challenged.

    There's no point being too paranoid about it, HMRC won't care about the odd missed receipt (unless its for a huge amount of money).

    If it helps, I keep a spreadsheet with every item of income and expense and scan all the receipts and invoices.

    If i'm understanding the video HMRC has on youtube (it then goes on to explain I must state Gross income to HRMC?) my understanding is I must total up all the £500/month so if paid rent for 11 months (1 falls outwith 6th April 19 to 5th April 2020 tax year for would be following years tax) the answer to this would be £5500 then I claim letting agency management fee (£60/month) and repairs in another section on the form (allowable expenses)??
    That's it.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      Are you preparing the paper tax return SA105 ? The figures declared in each box are for one year .

      So rental income = £5500.( box 20)

      Insurance and rates := ( box 24 )

      Prop Repairs = ( box 25 )

      Prof Fees ( letting agent ) = £660 ( box 27 )

      Comment


        #4
        The electronic self assessment is fairly easy. If you're not doing this I would recommend you get it set up for next time. There are also explanatory notes as you go along. Just done mine, it must be the covid effect! Doesn't normally get done until after Christmas.

        Comment


          #5
          jpkeates Thanks for the informative and quick reply. I didn't mean i'd charge for labour when doing repairs (might not be a lot for paint/shower or whatever i would need to buy but adds up but understand i'd keep receipts and add on form later as expense.) but your post is quite clear and think I've got enough to get me started tackling this form.

          I would consider an accountant as never thought of it that way but tbh I think i'll be able to do it - might need help with another part further down the line but i've got months to complete it ( Jon66 - i'm doing this but i hate forms as some questions/parts aren't clear, even in the explanatory notes - they sometimes overly confuse the subject. Hopefully after I've completed it this year, next year will be a doddle)

          Comment


            #6
            I've had a look over my rental statements and remembered the reason I have 11 months this tax year and not 12 was that the 1st month rental statement was on the 5th April 2019 (like one day before the 6th April 2019 tax year). I just want to confirm that this is correct or do I need to include the 5th April 2019 statement in this year?? I just find it odd its 11 months and not 12 but at the same time my understanding is this was in the 2018-19 tax year and I didn't earn enough to be taxed on and this was apart of this. Aprils statement from the letting agency is then on the 6th April 2020 (which is why i'm including this in next years tax return)

            Comment


              #7
              I'd include the 12th month.

              While you're correct that the income fell into the 2018/19 tax year, you didn't declare it then, which is could trigger a fine and a penalty.
              It probably won't, but you need to be very careful with your tax - getting on the wrong side of HMRC is a lifetime of pain.

              You say you didn't earn enough to be taxed.
              If the rent was your only income in the tax year, that could be the case, but if you had any other earnings it seems unlikely.
              Your business doesn't have a separate tax allowance of its own.
              When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
              Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

              Comment


                #8
                I signed up for the 2018/19 tax year as I thought I had to declare this and tax it but they said as I earned less than £2500 in property income for the year I didn't need to complete the self-assessment for that year.

                After watching more videos I am now even more confused . I thought - i'll have a crack at it and got to the next part "Property income allowance" - it says this is a tax free allowance of up to £1000 a year to use against property income.

                It says in the video - "If you use this allowance you cannot deduct any expenses from your property businesses". So if my income was £6000 or £5500 for the tax year but my letting agents fees are only £700+ and expenses less than £100... would it be a case of entering in the allowance £1000 and job done... can't claim any other expense? Or is it £1000 property income allowance + allowable expenses such as agent fees?

                This is my only property and don't have a company so not sure if this is a business or not but from watching a previous video I think it suggested this is a property business even if I am the individual owning the property?

                Comment


                  #9
                  My understanding is it's probably better using the allowance. Is there anything else that can be claimed such as interest on buy-to-let mortgage payments or is this not worth it?

                  Comment


                    #10
                    Originally posted by Gordon999 View Post
                    Are you preparing the paper tax return SA105 ? The figures declared in each box are for one year .

                    So rental income = £5500.( box 20)

                    Insurance and rates := ( box 24 )

                    Prop Repairs = ( box 25 )

                    Prof Fees ( letting agent ) = £660 ( box 27 )

                    Revised figures for your situation ( for 12 months rent.)

                    Annual rental income = £6000

                    Buildings insurance = £0.

                    Maintenance & Repairs = £100

                    Letting agent = 12 x £60 = £720

                    Total Expenses = £820

                    Profit = £6000- £820 = £5180.

                    Loan interest = £2000 ( estimated).

                    Comment

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