Frank

Thanks much. Enjoy your weekend. Frank

I need to clarify whether I pay tax on income for date the money was paid by my customer or when the money was cleared into my bank account. I use Stripe as my payment gateway and I always receive the money 2 to 4 working days after my customer made the payment. So if a customer paid me £75 on 04 April 2024, and I don't receive the £73.37 payment in my bank account until 07 April 2024, do I include the £75 in my 2023-2024 tax returns or do I add it to my 2024.2025 tax returns. I read that either way is acceptable, providing I consistently report it the same way every year. I just need to confirm. Thank you, Frank

I used the HRMC online self-assessment tax reporting system which guided me step-by-step. I entered my income and deductions when it prompted me to do so. How the heck did it flip something around so drastically? I contact HRMC for a review.

Hi, I'm a bit confused as to why I paid 20% on a £7,001 profit for 2022-2023. This is what I inputted into the online self-assessment system. Income: £32,818.84 Deductions: -£13,246.04 Profit: £19,572.80 Personal Allowance: £12,570.00 Taxable Net Profit: £7,002.80 This is the online calculations the HRMC website provided. Profit from self-employment: £19,571.00 minus Personal Allowance: £12,570.00 Total income on which tax is due: £7,001.00 £7,001.00 x 20% = £1,400.20 Income Tax due = £1,400.20 plus Class 4 National Insurance contributions: £7,663.00 x 9.73% = £745.60 plus Class 2 National Insurance contributions: £138.60 Total Class 2 and Class 4 National Insurance contributions due: £884.20 I paid the 2022-2023 income tax but when I used this HRMC estimator, https://www.gov.uk/self-employed-tax-calculator it states that I won't owe any income tax based on my net profit of about £9,000 for 2023-2024. Thank you for your help. Frank

[Display name amended - Admin]

Hi, Can someone clarify this answer provided to this question. A self-employed sole trader can only claim medical expenses "that are wholly necessarily and exclusively incurred in the performance of [work] duties". The nurse stated that her medical expenses relating to her back pain are a direct result from when only working as a nurse. This is "wholly necessarily and exclusively incurred" so why does the answer state such costs are not allowable? Also, the link does not provide information pertaining to self employed medical expense deductions. Thank you.

I'm a cash basis sole trader. I have a business credit card that I make purchases with for items such as camera equipment and online advertising. I do not pay off the balance in full each month, so I have a running balance with interest I pay on. The amounts I pay each month may be £100 one month or perhaps £300 in another month. Would I be correct to assume that I'm allowed to deduct these monthly payments and interest payments? Thank you and Happy Holidays. Frank

When converting and transferring US income to GBP/UK bank accounts, you use 1.219267. $48,000 / 1.219267 = £39,367.91531305284 or £39,367.92/£39,368 of taxable UK income. When reporting UK income to the United States IRS, you could use 0.8202. £35,000 / 0.8202 = $42,672.5188978298 or $42,672.52/$42,673. Last year, the IRS provided their rate for converting GBP income to USD, but I'm not sure if it's the same as the UK's rate. Although most of my income will be excluded from paying US taxes (qualifying expat who earns less than $120,000 a year and 66), we still have to file with the IRS unless we were to renounce citizenship. This will be my first full year in the UK as a sole trader collecting a US pension/social security. But from my estimates so far, you will pay less UK tax using the monthly conversation rates verses the annual flat rate. This is some partial US income of mine from April to September, so I'm glad I decided to use the monthly conversion rates last year. $10,935 / 1.219267 = £8,968.51 $10,935 / monthly rates = £8,759.44 Hope this helps! ;)