Pre-Trading expenses

This will be my first time filing taxes as a sole trader. Here's my question: My husband purchased an used grand piano for me in 2022 as a preparation for my piano teaching business, and I started trading in February 2023. Can I claim this expense partially or for my tax return 2022-2023 and another partially in 2023-2024 tax year as a sole trader? What's the difference if I use accrual basis or cash basis?

Hi,

You can refer to the guidance below for details about cash basis and traditional accounting:  

HS222 How to calculate your taxable profits (2023)

Please also refer to the guidance below for information about what can be claimed as Capital Allowances:  

HS252 Capital allowances and balancing charges 2023

Capital Allowances cannot be claimed if using the cash basis, except for cars. If claiming Capital Allowances for an item that was a gift, the market value of the item on the day the business started to use it, should be added to the relevant pool.

Thank you.