I started as a sole trader last year with different ways of earning, but assumed I was the business and I did not have to separate them. So I have just gone ahead willy nilly using my personal (several, taking advantage of switching incentives) bank accounts and credit cards for everything.
Didn't look into how to do things properly and just kept all receipts and invoices with no books created. I am able to create and expenses and sales list now and have all bank statements.
The first, the handyman business, I bought 3k of tools on a credit card, earned approx 2.7k. of which approx £1200 was profit, but I used this profit to pay for the purchase of materials for the next business. And still have the credit card, which I pay off interest free using my PAYE income, or any other income that comes my way.
The other is a cosmetics business which has costs of 3.5k and £40 sales. (took most of the year to formulate etc, wasn't trading until towards the end of the tax year)
The third is the sale of junk and random items from around my home for approx 1.8k on eBay. This was temporary but I'm assuming I need to pay tax on it as over 1k.
I also am paid via PAYE for a regular job at 17k, which I paid about £900 tax on. Which I assume I will be getting back when I submit my return.
Now where I am getting lost in what to do for my tax return is, if I separate the income streams into separate businesses I've used profit from one so called business to fund another. Leaving the first in debt. I'm struggling to get my head around what to do on my tax return because of this.
Is it possible to merge everything into one business for that tax year? Or do I need to have it up as 3 businesses? I would want the two to be separated in the future though.
Everything will be done properly going forward, but sorting this mess out from last year is looking genuinely impossible.
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