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| Author: | LeonElport [ Sat Mar 25, 2006 4:42 pm ] |
| Post subject: | Tax |
How does the tax side of things work when you are a PH owner driver? do they calculate on how many miles you have covered your clock every year and that gives them an idea how much you could have earned? And if thats the case then what if you use your car for personal use as well how can they tell ? |
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| Author: | smiffyz (geoff) [ Sat Mar 25, 2006 5:12 pm ] |
| Post subject: | |
Get a good accountant who does taxi insurance, they'll try and knock 10% off for private milage and bill you for the rest. 
But a good accountant will sort them out. Save EVERY recipt you get, mobile, car wash, vac, everythng. 
btw, dont admit you save fuel points (nectar etc) 
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| Author: | TDO [ Sat Mar 25, 2006 7:18 pm ] |
| Post subject: | Re: Tax |
LeonElport wrote: How does the tax side of things work when you are a PH owner driver? do they calculate on how many miles you have covered your clock every year and that gives them an idea how much you could have earned? And if thats the case then what if you use your car for personal use as well how can they tell ?
Well they can't tell, but then again it's difficult for you to prove that you don't, unless you have a 5-series Beemer in the drive to use on your days off, in which case your declared income will look suspect. You could keep exact records for your private mileage, but generally speaking I think the Revenue will accept an approximation like 5 or 10% - this will be deducted from your expenses that don't relate soley to your cab - a £100 invoice for tyres will be reduced to £90, but your council licensing fees won't have any private element taken off because these expenses have nothing to do with your private mileage. But generally speaking, the Revenue will look at your claimed fuel, expenses and income and compare them against what they expect. For example, if you claim expenses of £5k in fuel but only three quarters of the turnover of other drivers doing a similar job then that will clearly ring alarm bells. Of course, there could be good reasons for this - if your repair bills are bigger than other drivers this could just be because you've got a dog of a car. They can also look at this from the mileage side, and they can obtain records from the council's testing department. Your mileage will be compared against fare levels in your area to see whether the income that you declare seems reasonable (after adjusting for private mileage) Obviously this will be easier for taxis whose fares are set by the LA rather than PH which usually sets its own fares. But again it isn't easy to compare these things, since night drivers will get more cash per mile because fares are usually higher. And dead mileage has to be considered as well, because this will vary tremendously depenending on each driver's working practices. Other complications include fare discounting by taxi drivers, which is widespread in some areas, therefore the official council tariffs can be misleading. Therefore it's a very complicated business, and at the end of the day it's not really an exact science, but if the Revenue challenges your figures it can be difficult for you to refute them. But it should also be borne in mind that probably only a small number of drivers are looked at in detail in any single year - in most cases they probably only give the figures a quick check and wave them through. But if you are selected for an investigation then they will look at your books for the past few years. |
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| Author: | Sussex [ Sat Mar 25, 2006 7:23 pm ] |
| Post subject: | Re: Tax |
TDO wrote: But if you are selected for an investigation then they will look at your books for the past few years.
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| Author: | broxibear [ Sat Mar 25, 2006 8:59 pm ] |
| Post subject: | Re: Tax |
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aye correct, i got done over 4 years, 1 back and 2 forward  over and above the year hector asked about 
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| Author: | Paisley Buddie [ Sat Mar 25, 2006 11:08 pm ] |
| Post subject: | |
This should be of interest to anyone under investigation http://www.litrg.org.uk/help/lowincome/selfemployed/assessment.cfm#enquiry |
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| Author: | LeonElport [ Wed Jul 26, 2006 11:17 am ] |
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Do you get taxed on the tips you receive? Is it wise to keep the tips seperate from the takings ? |
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| Author: | tcabbie [ Wed Jul 26, 2006 11:41 am ] |
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of course its income |
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