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Have I done the right thing at the end of my 1st financial year?

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Bliss69

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Just having a panic attack:eek:
Am I right in thinking that as a self employed nail tech I will only be taxed on wages and what's left in the bank?
My accounts are due in at the accountants 1st April and I've been spending like crazy stocking up on products to bring my profits down. I haven't paid myself any wages in my first year but I do have taxed wages from another job.
I have enough in my account to cover national insurance and accounting fees
Have I done the right thing!
 

Cazbar

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If you have used your tax free personal allowance in your other job you will be taxed on your self employed income minus outgoings such as products and costs etc but not wages.
 

TanBird

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You're only taxed on profits, so yes, wages + what's in the bank.

You have made a good move stocking up on products to reduce profit.

Just get those figures to the accountant now and relax ;-)
 

Cazbar

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Sorry just seen you said you haven't paid yourself any wages.
It's purely income minus expenditure then :)
 

Haylez250

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Be careful. Any gain in stockfile from one year to the next should be classed as profit according to hmrc. Otherwise everyone would just buy loads come the end of the year xx
 

BannerPenguin

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Be careful. Any gain in stockfile from one year to the next should be classed as profit according to hmrc. Otherwise everyone would just buy loads come the end of the year xx
They do...
I'm not saying this is wrong but this is even what FTSE100 companies do. End of year buy something expensive for the business rather than give it to the tax man :)
 
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Bliss69

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I can see where you're coming from I hope I'm not in trouble :sad:
I've used the money to buy all the kit to enable me to go mobile plus some salon essentials. I do confess to purchasing several new Shellac colours though:o
I've not really spent much over the last 12 months as its my first year and I wasn't sure how busy/quite I was going to be from month to month.
Heck I'm dreading handing my accounts over now
 

squidgernetball

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I can see where you're coming from I hope I'm not in trouble :sad:
I've used the money to buy all the kit to enable me to go mobile plus some salon essentials. I do confess to purchasing several new Shellac colours though:o
I've not really spent much over the last 12 months as its my first year and I wasn't sure how busy/quite I was going to be from month to month.
Heck I'm dreading handing my accounts over now
You'll be fine I'm sure. At least it's not ridiculous amounts!

A few new Shellacs are always worth it!

Vic x
 

beauty mad Jo

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This is exactly where I'm at, although I registered the business with customs house mid April 2014, i didn't open the business untill June 2014. So ive not been trading for 1 year yet.
My accountant says I dont need to put the books in untill end of April, I really hope this is correct...!!?
Thanks jo x


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Haylez250

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Well that's what goes on my account at the end of the year done by my chartered accountant. It's an increase in stockfile... So you could have for example 10,000 stock at the start.... Use 6,000 then buy 6,000 right before the tax year and this isn't classes as profit. But if you have 10,000 then use 2,000 then buy 6,000 it's classed as 4,000 profit. You can do what you like and no one will probably ever notice I'm just telling you how it is and to be careful as a massive jump in stockfile (from opening stock to closing stock) is technically classed as profit x
 

Haylez250

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They do...

I'm not saying this is wrong but this is even what FTSE100 companies do. End of year buy something expensive for the business rather than give it to the tax man :)

Also I reiterate the fact that it's stock only that I'm taking about. Anything useable or saleable. Buying a new premises/washing machine/company car would be tax deductible. It's stockfile only that eats into profit. Which is probably not what FTSE 100 companies invest in x
 

BannerPenguin

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Also I reiterate the fact that it's stock only that I'm taking about. Anything useable or saleable. Buying a new premises/washing machine/company car would be tax deductible. It's stockfile only that eats into profit. Which is probably not what FTSE 100 companies invest in x
Arrrrr makes sense :)
 

surf girl

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Well that's what goes on my account at the end of the year done by my chartered accountant. It's an increase in stockfile... So you could have for example 10,000 stock at the start.... Use 6,000 then buy 6,000 right before the tax year and this isn't classes as profit. But if you have 10,000 then use 2,000 then buy 6,000 it's classed as 4,000 profit. You can do what you like and no one will probably ever notice I'm just telling you how it is and to be careful as a massive jump in stockfile (from opening stock to closing stock) is technically classed as profit x

Aw I was hoping it actually diddnt work like that :( 🙈

I've done all my books up to date but have a lot of retail stock on shelf...

How do you work out how much it's worth?

Where abouts do you record it?

I had a feeling this was gonna happen, my accountant asked me last year if I had retail stock to add on but at the time I diddnt so I have no experience in this yet? 🙊
 

Cholo

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Errrrm, just a reminder that this is a public forum so be mindful that it could be easy to identify people via things posted eg. location/ Facebook / website links etc. Just be aware of what you're saying..... 👀
 

squidgernetball

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Aw I was hoping it actually diddnt work like that :( 🙈

I've done all my books up to date but have a lot of retail stock on shelf...

How do you work out how much it's worth?

Where abouts do you record it?

I had a feeling this was gonna happen, my accountant asked me last year if I had retail stock to add on but at the time I diddnt so I have no experience in this yet? 🙊
You're allowed to have stock on your shelves. We have a ton of stock. That's a business. I think if anyone's concerned, they should speak to an accountant. All our businesses are different so a lot of advice given is speculation and hearsay.

Here's to the new tax year!

Vic x

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Haylez250

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Don't panic. You just add it up at cost price. Chances are if it's your first year and it's just a few retail products it won't make much difference anyway. Speak to your accountant and he will be able to point you in the right direction with all these things. Just something to think about for next year. Hth x
 

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