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Where Taxpayers and Advisers Meet

Tax return if below threshold

marispiper
Posts:4
Joined:Sun Jan 28, 2018 11:58 pm
Tax return if below threshold

Postby marispiper » Mon Jan 29, 2018 12:03 am

If i'm below the threshold for paying income tax, is there anything to be gained from adding expenditure etc to bring my total earnings down further?

JRG
Posts:424
Joined:Wed Feb 03, 2010 4:40 pm

Re: Tax return if below threshold

Postby JRG » Tue Jan 30, 2018 12:08 am

There's nothing to be gained regarding income tax, except to record expenditure for historical purposes in case you might be above the threshold in the future.

marispiper
Posts:4
Joined:Sun Jan 28, 2018 11:58 pm

Re: Tax return if below threshold

Postby marispiper » Tue Jan 30, 2018 3:50 pm

Yes I'll be over the threshold by next year's return - so i guess maybe it'd be useful to record outgoings. Thanks JRG.

SteLacca
Posts:448
Joined:Fri Aug 07, 2015 2:17 pm

Re: Tax return if below threshold

Postby SteLacca » Tue Jan 30, 2018 5:42 pm

Will the expenses create a loss, which may be able to be used against future profits?

marispiper
Posts:4
Joined:Sun Jan 28, 2018 11:58 pm

Re: Tax return if below threshold

Postby marispiper » Tue Jan 30, 2018 5:46 pm

No, there won't be a loss. Is that the only way they'd be useful historically?

SteLacca
Posts:448
Joined:Fri Aug 07, 2015 2:17 pm

Re: Tax return if below threshold

Postby SteLacca » Fri Feb 02, 2018 2:58 pm

Unfortunately, yes. If there's no taxable profit and no loss to carry forward, then there is little value.

If any expenses represent capital purchases which would qualify for capital allowances, then you can disclaim the capital allowances and carry forward the opening balance (or purchase cost) to later years to mitigate future liabilities. If not, then keep the records in a shoe box in case HMRC ever challenge you and forget about them.

marispiper
Posts:4
Joined:Sun Jan 28, 2018 11:58 pm

Re: Tax return if below threshold

Postby marispiper » Fri Feb 02, 2018 7:55 pm

Thank you SteLacca - that's just the answer i was hoping for.


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