Starting as Self Employed
Good Morning One and All.
I have begun the process of starting my own business and registering as self employed, and have a number of questions regarding tax and expenses that I am hoping you good people could help me with.
First let me explain my situation.. I am fully employed and intend to keep this job whilst working my new self employed business from home.
My questions are:
1) As I earn over the taxable allowance in my full job, I get no taxable allowance from self employment? Therefore my income tax would be 20% on anything earned in self employment?
2) I went to university, which I pay 9% tax on anything above £15k that i earn. As I earn this in my full job, this 9% is applicable to anything I earn in self employment. Meaning that my tax owing for self employment will be 29% on anything that i earn?
In terms of expenses I have been told that I can count my house and utility bills as an expense in proportion to what I use for business.
3) I have a house, which has 1x living room, 2x bedrooms, 1x kitchen, 2x toilets, 1x shed. Now I am using the spare room as an office and the shed for storage. When calculating how much of a percentage I use for business expenses, do I look at it as having 7x rooms (including kitchen & toilets) and calculate the percentage I use from this, or 5x rooms (bedrooms, living room, kitchen & shed), or do I discount the kitchen all together?
(apologies if this a bit of a trivial question, but it obviously makes a huge difference to the percentage i can count as expenses)
4) Food: Can I count any food, drink, refreshments that are to be consumed in my house as an expense?
5) Travel: I currently pay a hefty sum of money on rail fare to get to my full time job, I assume there is no way to include this as an expense?
6) My self employed job will involve visiting factories every so often, which I will do so by train. Can these tickets by counted as an expense?
7) Any tips on reducing my already hefty tax bill are greatly appreciated.