Do we pay ourselves?

[Baileybods]

Hi

I have a question .... hope someone out there can help me!
I have been childminding 10 years now but have recently been advised that I should pay myself a salary, which is then classed as an expense for tax purposes. is this right? I have never done this and it kind of makes sense but don't want to if the tax man will frown on it!

I also read on here about buying back toys/equipment. again I had never heard of this so if I started to do that now, would I just put it down as a normal expense or do I treat it differently?

Thanks

Vanessa :)

[sarah707]

Your 'salary' is what is left when you have paid all your bills :D

[supermumy]

Yep what sarah has said :)

[zippy]

I think the confusion has arose because there is different rules for limited companies I think, you'd pay yourself a salary if a limited company, pay normal tax on that. Then you'd pay corporation tax on remainder of profit. Of course I could have this total wrong and be as confused as you lol

[Baileybods]

Thank you for clearing that up - don't want to upset the tax man! What about the buying back equipment - just class it as a normal weekly/monthly expense? V

[zippy]

Thank you for clearing that up - don't want to upset the tax man! What about the buying back equipment - just class it as a normal weekly/monthly expense? V

I put that through my £10 book, buying toys off children

[Chatterbox Childcare]

You will have a lot to claim no doubt. I get a sheet of paper and write down exactly what I am selling to my business and then put an amount by the side of it. Tally it all up and put it into your books as expenses as you would any other expense. Don't be surprised if it runs into the £100's, include books, cd's and dvd's too.

[supermumy]

Ok I'm confused I have 4 kids and the cm kids use all their stuff but doesn't that come in with wear and tear not buying ur own children's toys bk? Prams etc if ur child isnt using yes but toys? Will the tax man allow this?

[Koala]

Anything you use for your business should be claimed as expenses. Even the air the children breath - put it down as an expense :laughing: .

You aren't paid enough to throw your money away to the tax man. When you start earning more than the minimum wage after expenses and yes thats over all the hours you work prepping, planning and training not just the time you have kids with you, then start worrying about handing your hard earned money over to the IRS who are probably on 5 times as much as you! :thumbsup:

[Chatterbox Childcare]

Ok I'm confused I have 4 kids and the cm kids use all their stuff but doesn't that come in with wear and tear not buying ur own children's toys bk? Prams etc if ur child isnt using yes but toys? Will the tax man allow this?

If your children are playing with the toys then they are not business toys but any that they are not using can be sold on paper to your business and yet the tax man allows this

[blue bear]

If your children are playing with the toys then they are not business toys but any that they are not using can be sold on paper to your business and yet the tax man allows this


We were told at a tax conference that you can't buy toys into your business from your children if the minded children have been playing with them and that you should put through as a percentage expense any toys you buy that your children share with the mindees. This includes birthday and Christmas presents. She said at the set up of business you need to work out which toys willbe shared and work out the percentage of time they will be shared,work put a reasonable price for the toys as a second hand item and only put that percentage through your books,

[Chatterbox Childcare]

We were told at a tax conference that you can't buy toys into your business from your children if the minded children have been playing with them and that you should put through as a percentage expense any toys you buy that your children share with the mindees. This includes birthday and Christmas presents. She said at the set up of business you need to work out which toys willbe shared and work out the percentage of time they will be shared,work put a reasonable price for the toys as a second hand item and only put that percentage through your books,

I agree if you are buying new toys but I am talking toys that my children already had and now are used by my business. All new toys are childminding toys!

Love to know how the tax man would know what mindees are going to play with for the next year so I could apportion it!

Seriously, just be sensible.