Not claiming expenses

[HTSMumma]

Hello.
This is a very strange question but I wonder if anyone has had a similar experience.
My husband and I rent. We are currently saving for a deposit for a house. I started childminding in September so I'm obviously going to need at least a couple of years' worth of books to show a mortgage company.
Doing mortgage calculations online the other day, I discovered that if I decrease my gross income by, say £3,000, if affects what I can borrow by £10,000. So, when claiming expenses and decreasing my gross income, it will have a negative affect on what I can eventually borrow.

My question is, can I not claim my expenses to increase my gross income? I know this means I will have to pay more tax (something that I've been putting aside for every month), but it will help me in the long run being able to get a bigger mortgage.
I just want to know if this is legal, above board, ok to do! I have searched for the answer online but I'm not having much luck!

TIA!

[Chanelle]

Yes you can. I did this and managed to get a mortgage. My financial advisor told me to so as it was in January we were enquiring.

[dette]

gross income is before any deductions for expenses so if they are looking at that figure it wont matter what you put through as expenses your gross will be the same

[HTSMumma]

gross income is before any deductions for expenses so if they are looking at that figure it wont matter what you put through as expenses your gross will be the same

Are you sure? Surely they have to work out a gross income first to work out your tax bill? To work out your tax bill, don't they need to take off your expenses first, so you don't pay tax on your expenses?
So, to work out your gross for the year, surely you need to take your expenses off that first...

Thanks for your replies!

[loocyloo]

The tax people want your gross income minus expenses ... This gives your net income and this is what is taxed.

Some mortgage providers look at the gross income of the self employed, others only look at the net income.

Good luck

[samb]

I saw a financial advisor next week as we are wanting to move. She told me the mortgage providers will want to know my net income. I worked out this current years accounts as much as I could and took details of last 3 years of accounts with me. I asked the same as you- shall I not put through expenses? She said yes definitely as again like you it makes a huge different to what I will be able to get for a mortgage. She also said many lenders will take an average of last 2 years which is a bit annoying as I claimed everything I possibly could last year but never mind. Again like you it means paying a sizeable amount of tax but in the long run I get to move and that is more important to me. She said thetax man does not mind that you want to pay more tax and it is all above board. She also said to ring them and get your sa302 sent to you of the last 3 years as evidence of income. We will be selling/buying after this tax year ends and so I will submit them and ask for that sa302 form too and hopefully we will be able to move. Scary isn't it!

[HTSMumma]

Gosh, this is more of a minefield than I originally thought!
I'm even more confused now! I think I better go to sleep before I give myself a headache.... ;-)

Thanks ladies!