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Set up costs spanning tax years.... Advice.... Help
Hi folks,
Ok I officially started trading Mar'13 so had one months income and more outgoings than income, posting a loss in the tax return I did in Jan'14 for the 2012/2013 tax year.
Obviously my set up costs ran into the 2013/2014 tax year with a multitude of extras I've had to buy as I've gone along (and earnt the funds to be able to purchase)....
I also discovered expenses I'd forgot to claim.
Adding the extra set up costs + the items I forgot to claim in the previous tax year it works out that I'm not going to post much profit whatsoever for the 2013/2014 tax year.
However on my initial estimates for the 2014/2015 tax year I'll be posting decent profits I hope.
1. Is it allowed by HMRC for me to add extra set up costs + costs I've forgot in the previous tax year?
2. Is it normal to have made a loss for the 2012/2013 tax year (only traded 1 month) and then make an extremely small profit in the 2013/2014 tax year (only 1 mindee for the bulk of it) (my expenses look to be high).
I guess I'm just wondering if HMRC accept you'll make little to no profit in your 1st couple of years while your purchasing equipment and finding your feet......
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Not sure on answer but I would have thought as soon as you start minding, you have to put set up costs on your first tax return. As you made a loss on your first tax return it would have had a knock on effect on your next tax return as you can take the loss over from your first year.
I don't think many childminders earn much to start with so it shouldn't flag anything up to HMRC
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It is quite normal to make a loss in your first year - I can't see that it will make any difference whether you go back and change last years return as the loss being brought forward is the same and adding more expenses to this year BUT I am not an accountant and would recommend you contact the HMRC and ask for their advice (Business Line are also a good place to go). Put down the name of the person you spoke too in your accounts for future reference
Debbie
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