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Self Employed Support - "Trading Profits"??

The government's self employed support isn't clear on its definition of "Trading Profits"?

Didn't find your answer?

Is "trading profits" intended to be accounting profits (maybe after depreciation) before capital allowances and any private use adjustments or taxable self employed profits??

Any ideas, anyone?

Thanks 

 

 

Replies (9)

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By Steve Holloway
27th Mar 2020 07:58

Surely the only number HMRC would link to would be the taxable profit i.e. the same one that is used for mortgage purposes? Anything else would be hugely complicated to determine and would confuse everyone!

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Replying to Steve Holloway:
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By Monsoon
27th Mar 2020 08:12

Agreed, it will be taxable profit as per HMRC tax computation, that's the easiest and fairest way to do it. Sucks for anyone who got to claim a big AIA in a relevant year but it would be too complicated to administer if you start picking apart things too much.

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Replying to Monsoon:
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By davidtilsley
27th Mar 2020 08:22

Thank you guys, useful to have a consensus! Obviously clients do tend to have higher capital allowances at the beginning of their self employment, so very harsh on them!

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Replying to Monsoon:
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By I'msorryIhaven'taclue
27th Mar 2020 08:58

Monsoon wrote:

Agreed, it will be taxable profit as per HMRC tax computation, that's the easiest and fairest way to do it. Sucks for anyone who got to claim a big AIA in a relevant year...

It also sucks for many whose self-employed business commenced in say 2016/17, 2017/18, or 2018/19 and made a loss / negligible profit in their first year or so. Surely there should be a safety-net subsistence-level grant for those whose self-employed income across their relevant years averages out at little or nothing?

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Replying to Steve Holloway:
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By cbanks
17th Apr 2020 11:36

Sorry, but I disagree entirely. If taxable profits are to be the determinant figure, why would there have to be a delay. These figures are known by HMRC, why don't they then advise self employed of how much they are entitled to. I am absolutely appalled at the non activity of the accountancy bodies, yet again, and no real surprise as too many of them sitting on the bodies have not been at the coalface since SA came in. The time for action was immediate and I have seen no response from any of the Institutes, who should be pushing for clarification. I have written to my MP without any joy. To ignore the effect of Capital Allowances is criminal. The whole thing stinks, and I can foresee a reaction akin to Gordon Brown's removal of the 10% tax band. Where is Frank Field when you need common sense?More critical for us is - where are our Institutes when we need a spokesbody?

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By Paul D Utherone
27th Mar 2020 09:42

Noticed the minister on TV this morning when asked about the £50k cliff edge just kept saying "it's £50k profit, but most on that level earn £200k".

What does he mean? Turnover? And doesn't that suggest substantial other, possibly fixed, costs that still need to be met?

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Replying to Paul D Utherone:
By Steve Holloway
27th Mar 2020 10:04

I think it is quoting an average across that sector as it will include footballers, entertainers etc

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By wispboy704
29th Mar 2020 11:41

Just wondered . My profit from my self employed work is less 50 percent than my rental profit from a property.Would I be eligible for the self employed grant as I noticed it said something about this in regards to trading profit?

thx

Chris

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By Matrix
29th Mar 2020 12:06

If it is less than 50% of the total then no claim, read the guidance we have so far.

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