I am setting up my first holiday let flat, and plan to handle changeovers myself for the time being. Property is about 15 mile 'round trip from home - can I charge a mileage rate for each visit as a business expense?
Also, can I charge a labour rate for my work and how do I quantify "laundry" costs if I wash, dry and iron it all myself?
Still trying to get my head around the tax/allowable expenses side of it all, as only ever let residential property before.
Thanks in advance!
How to quantify changeover expenses?
You can't charge out your labour just the expenses like the electric and capital cost of the iron, washing machine, and fuel. You don't gain anything by charging your time out as an expense to your cottage, as you would then have to pay tax on the "income" you have earned from your labour - just like a cleaner would have to pay tax if you paid them to do it for you.
Thank you, I appreciate what you mean about the labour charge - never though of it like that, makes sense!
As for the mileage/fuel charge - should I use a standard XXp/mile (got a feeling the standard HMRC rate is something like 34p - although will increases in fuel price I suspect that is way off the mark these days!).
Thanks again!
As for the mileage/fuel charge - should I use a standard XXp/mile (got a feeling the standard HMRC rate is something like 34p - although will increases in fuel price I suspect that is way off the mark these days!).
Thanks again!
Cornish Maid
You can claim mileage expenses, the current rate is £0.45 per mile.
You must keep a diary of all your journeys that you want to claim for; I use an excel spread sheet to record them for each financial year; I include the date, vehicle registration, mileage and reason for journey (e.g. cleaning, meet and greet, etc). I also do the sums for each journey with a running total at the bottom. I have been doing this for 4-years and HMRC accept the spread sheet I include with my tax return.
You can claim mileage expenses, the current rate is £0.45 per mile.
You must keep a diary of all your journeys that you want to claim for; I use an excel spread sheet to record them for each financial year; I include the date, vehicle registration, mileage and reason for journey (e.g. cleaning, meet and greet, etc). I also do the sums for each journey with a running total at the bottom. I have been doing this for 4-years and HMRC accept the spread sheet I include with my tax return.
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"There is no human problem which could not be solved if people would simply do as I advise"
"As for my amnesia, I've had it as long as I can remember"
Real name: Steve
Gender: Male
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barbersdrove
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- Location: crowland south lincolnshire
I have to admit to being less well organised re fuel/travel expenses. I do record but in a less detailed way and as I don;t have to submit full accounts to the IR just a summary I've had no bother with that method.
Living on site, if I do go in the car for business it's usually to purchase something, or to the cash and carry or the laundry, ( costs for which you can claim so maybe not doing it yourself could be a bit more attractive). I have receipts for each of those trips via the laundry invoice, or purchase receipt etc. I then google the trip to see what the mileage is and claim for it on that basis.
I know it's not the way you should do it but I have the receipts so I obviously did go. Also, when I do go out it's often not to just go to these places, I would combine it with things I want to do for myself so separating the mileage is a pain. This way they can see i have not overclaimed if they ever did decide to investigate my affairs.
No doubt others will think this is appalling but I think I could argue that a record has been kept.
I do record my mileage at the start of my year and can see what proportion has been for business. that helps with claiming for proportionate costs for repairs etc.
Living on site, if I do go in the car for business it's usually to purchase something, or to the cash and carry or the laundry, ( costs for which you can claim so maybe not doing it yourself could be a bit more attractive). I have receipts for each of those trips via the laundry invoice, or purchase receipt etc. I then google the trip to see what the mileage is and claim for it on that basis.
I know it's not the way you should do it but I have the receipts so I obviously did go. Also, when I do go out it's often not to just go to these places, I would combine it with things I want to do for myself so separating the mileage is a pain. This way they can see i have not overclaimed if they ever did decide to investigate my affairs.
No doubt others will think this is appalling but I think I could argue that a record has been kept.
I do record my mileage at the start of my year and can see what proportion has been for business. that helps with claiming for proportionate costs for repairs etc.
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What are you trying to work out? For the tax man or for your prices.
For you prices, I would say you have the cost of a man hour for a cleaner, in my case it is 22€/hour including NI payments.
Cost of sheets/towels: washing, drying, ironing, your time, replacements etc - I charge 15€ per 2 persons, and I don't think there is much profit in that figure, as I have to tumble dry everything and pay for someone else to do the ironing etc.
For you prices, I would say you have the cost of a man hour for a cleaner, in my case it is 22€/hour including NI payments.
Cost of sheets/towels: washing, drying, ironing, your time, replacements etc - I charge 15€ per 2 persons, and I don't think there is much profit in that figure, as I have to tumble dry everything and pay for someone else to do the ironing etc.
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barbersdrove
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salmoncottage
- Posts: 294
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We have started keeping a diary of all our questionable or sundry type expenses now as they can often get complicated or merged with our private ex's or lost altogether; for instance we don't live on site and often have to make short notice travel arrangements to and fro. So we enter all expenses into a diary at the end of one of our 'sorties' and that goes to the accountant to calculate the percentages fairly and correctly for that period. A simple trip to B&Q can often get paid in cash or by the wrong card for instance and I'm always paying the window cleaner in cash etc so the diary can now show the accountant what is business and what's not. It was his idea and I found it a pain at times but it's well worth the effort as we found we were loosing out quite a lot.
So Cornish Maid, keep a little diary and get into the habit of entering the details of anything your not sure about claiming and your accountant will keep you right. And all the very best with your holiday property.
So Cornish Maid, keep a little diary and get into the habit of entering the details of anything your not sure about claiming and your accountant will keep you right. And all the very best with your holiday property.
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I was under the impression the all you had to do was calculate a reasonable percentage for driving costs with business. So you keep a diary for a month and then work out what percentage was work costs and use this to calculate the total throughout the year. Do the same every year or so to keep it accurate. I think there may be regional variation and it may be worth talking to the local tax office to see what they are happy with.
No reasonable estimates won't do. Keep the most accurate record you can.
Like barbersdrove, I keep a record but don't always remember to record every trip, every time. However, I always have a receipt or a bank paying in slip etc, so I just do a catch up every now and again, with a google search if necessary. Every trip has a reason linked/recorded to it, as I would never remember otherwise if I did happen to be investigated!
I've claimed mileage at 45p per mile so far, but this year with a change of car I'm investigating whether to go the full expense route. The jury's out at present, but once you've decided a method, you cannot change again until you next change your car.
Like barbersdrove, I keep a record but don't always remember to record every trip, every time. However, I always have a receipt or a bank paying in slip etc, so I just do a catch up every now and again, with a google search if necessary. Every trip has a reason linked/recorded to it, as I would never remember otherwise if I did happen to be investigated!
I've claimed mileage at 45p per mile so far, but this year with a change of car I'm investigating whether to go the full expense route. The jury's out at present, but once you've decided a method, you cannot change again until you next change your car.