Claiming back expenses (from previous financial years)

**centurian** · 14 August 2011, 15:37

Hi, welcome to the board

Strictly speaking you should have declared previous years as a loss, which could now be used to offset against profit. You can probably restate these returns. Might raise an eyebrow with HMRC - and cause you to appear as a blip on their radar, but as there are no monies due to HMRC, it won't cause you any problems in that respect.

However, you may be able to simply include them in this year. In the past, I have mislaid a receipt, but later found it. Accountant was happy to simply include it in the next year's returns. But that was for a one-off item - and a capital item at that, so had multi-year potential, rather than a revenue expense that is specifically tied to activities in one year.

An accountant can give a better answer, but it may be the case that some of the expenditure can be included, whereas others not, so you may need to go through item by item with an expert.

**John Doe** · 14 August 2011, 16:51

Thank you

**northernladuk** · 14 August 2011, 19:12

Just out of interest what did you pay on the company in the last 2 years while you were permie? Wouldn't buying consumables/PC's or whatever (am guessing here) for a company that isn't trading a bit iffy??

**John Doe** · 14 August 2011, 20:51

I bought a notebook, virtual office mail redirect, fax redirect, business cards, domain names & email hosting, ...

**northernladuk** · 14 August 2011, 21:02

Originally posted by John Doe View Post

I bought a notebook, virtual office mail redirect, fax redirect, business cards, domain names & email hosting, ...

But you are not using them for your business? You were permie so how can you justify them?

I am being pedantic here but I appreciate you would claim you were building your business up ready for when you went contracting.... but 2 years? Will HMRC see the funny side of it over such a long period of time? The latop particularly could be out of date by now and has been used purely for personal use so BIK has to be taken in to account?

**John Doe** · 14 August 2011, 21:08

I founded the business in March 2009 and got most of them items around that time. Hunted for contracts for a few months. Gave up in December and went perm for 18 months and now in August after looking for a while finally got some contracts lined up ...

**northernladuk** · 14 August 2011, 21:47

Personally I would have written if off then after so long if nothing else but to avoid being a blip on HMRC's radar but would be interested to see what the accoutants say. Hopefully one will pop up tomorrow.

**Greg@CapitalCity** · 14 August 2011, 21:58

Its OK to claim formation and pre-trading expenses so long as they relate 100% to the business you set-up. If your company did not actually start trading back in 2009 then I would suggest you bring these into your current trading period (on the assumption no trading period has existed before - have you been filing dormant accounts for the company?). The business cards, domain names etc all sound OK so long as you found no personal use for them - the notebook??...well, your personal use of this over the past 2 years has probably been significant in relation to its business use - unless there are other factors at play here which you have not mentioned, there would be a benefit-in-kind charge to be applied. Probably better to sell the computer to your business now at market value and claim the tax deduction for that (so long as its primary purpose is business use - see HM Revenue & Customs: Computers loaned to an employee).

**northernladuk** · 14 August 2011, 22:16

What happens if he hasn't been submitting dormant accounts? Does that include submitting nil Paye and NIC for the ltd?

Claiming back expenses (from previous financial years)