Can I use PayPal receipts in end of year TAX return?

[hellohello]

I'm from the UK and I outsource some of my work to people in countries outside of the EU and I was wondering how do I deal with end of year TAX return? I for example outsource a job for a client where the client pays me £100 and I pay someone else to do it for let's say £50. Once the job is complete, client pays me £100, I pay the outsourcer via PayPal £50 and keep £50 for myself. How do I prove this to the government? Are PayPal receipts enough? Thanks.

 

[sanjiv]

Do you not have an invoice from the people that you outsource the work to?

 

[hellohello]

Do you not have an invoice from the people that you outsource the work to?

Nope. It's different people at different times. What if I ask them to request the payment through PayPal? Will that count as a valid invoice?

 

[sanjiv]

I believe that you can make invoices on PayPal. Get them to do that.

 

[Williams lester]

I'm from the UK and I outsource some of my work to people in countries outside of the EU and I was wondering how do I deal with end of year TAX return? I for example outsource a job for a client where the client pays me £100 and I pay someone else to do it for let's say £50. Once the job is complete, client pays me £100, I pay the outsourcer via PayPal £50 and keep £50 for myself. How do I prove this to the government? Are PayPal receipts enough? Thanks.

If you can get an invoice from the freelancer then great, use that. If not then just use the paypal payment as proof of expenditure. I assume you could back up the claim if necessary with e-mails etc detailing an agreement to do the work for a fee?

 

[hellohello]

I believe that you can make invoices on PayPal. Get them to do that.

I've just realized you can, I'm just not sure if it's available in every country, hopefully it is. Either way, thanks.

If you can get an invoice from the freelancer then great, use that. If not then just use the paypal payment as proof of expenditure. I assume you could back up the claim if necessary with e-mails etc detailing an agreement to do the work for a fee?

Yeah, I guess if I can't get an invoice I will then keep copies of emails detailing an agreement.

Since I will be outsourcing work, the currency will most likely be from another country, e.g. USD. How do I calculate this in regards to the TAX return? Will I have to convert the sum using the figures given by HMRC or will the PayPal conversion of the amount to GBP will be enough?

Edit: You have a very nice site, once I finish reading I may be interested in your services.

 

[Williams lester]

Since I will be outsourcing work, the currency will most likely be from another country, e.g. USD. How do I calculate this in regards to the TAX return? Will I have to convert the sum using the figures given by HMRC or will the PayPal conversion of the amount to GBP will be enough?

Use the paypal converted figure, this will be fine.