Expenses - not in trading name

lizzy Registered Posts: 36 πŸ’« 🐯 πŸ’«
Please can someone clarify a couple of points for me.

If a sole trader has expense invoices, say telephone & internet but they are under the personal name & not the trading name is it still OK to allow a % for business use that they have advised? Would this amount get posted to the accounts with the credit entry being to capital introduced?

If the sole trader has also become VAT registered do you just reclaim VAT on the business use % (once the bills are in the trading name).

Any advise is greatly appreciated.

Thank You :001_smile:


  • T.C.
    T.C. Registered, Tutor Posts: 1,448
    For a sole trader, it doesn't really matter if the bill is in the business name or his own name. Where you post it depends on where it was paid from - business account or personal account. And yes, the VAT could be reclaimed against the business element of the expense.
    I think you might be trying to make this more complicated than it needs to be. What software are you using?
  • lizzy
    lizzy Registered Posts: 36 πŸ’« 🐯 πŸ’«
    Thank you, yes I do have a habit of complicating things!
    It is paid from his personal account so will have to be capital introduced.
    Do you mind if I ask another question - here goes.
    The sole trader began in the tax year 0607 & on his 0607 return had only 2 months taxable profit from this trade. Included in this was a 1st year allowance on a van & a small amount of expenses relating to the van. The van has done a lot more miles in 0708 and it would have been a lot better to have used the 0.40p per mile option. Do you think there is anyway of using this method now even though its the same vehicle? I guess I already know the answer , just hoping!
    This van has apparantly had no private use at all during the year. Do you think HMRC would accept that?
    Thank You in advance
    BIG WAL Registered Posts: 133 πŸŽ† 🐘 πŸŽ†
    The mileage allowance is for use of a private car, not a van. I would suggest all the van expenses are a business expense, and capital allowances are available in the normal way.

    Much less complicated to keep it like that, and avoid anything but incidental private use for the van. HMRC would expect a van to be for business use.
  • T.C.
    T.C. Registered, Tutor Posts: 1,448
    Sound advice. Keep things simple! :thumbup1:
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