I sell plants

[Billsoh!]

I sell plants online. I am a new seller and trying to work out my bookkeeping columns for certain expenses. I wanted to keep them to the main columns that line up with tax return. So in light of that and my occupation which columns would you say electricity and water would come under. The choices are Cost of sales , other direct costs ,premises costs , general administrative costs , other business costs. Now I have read the HMRC detail but cannot really find the answer given it depends on your occupation. The water is a more direct cost than the electricity in terms of the raw material aspect but water is not a raw material really as such. This probably makes it an expense from one of the others. What are peoples opinions and why. Hope you do not mind. thanks.

[pawncob]

If you're growing plants, or preserving them for sale, you can't do it without water, so it's a direct cost.

Alternatively include both items as premises costs (No one is going to be that bothered about it).

[Budget83]

Premises Costs would be my preferred choice.

In all honesty its the figures that are important and as long as you put electricty in one column one year and are then consistant in the preceeding years all is good.

I woulnt get too hung up on where they go becuase HMRC are intrested in the bottom line. I would check the gross profit percentagees and net percentage to the preceeding year and as long as they are similar you can be fairly confident its correct.

If your gross/net profit differs by a lot I would investigate why and make sure you can justify the difference before submitting.

Good luck with the venture.