Contractor - working out tax deductable
Discussion
I am a Mechanical engineer, contracting. Only a few months in, but I am looking at trying to expand on my skills. One area we are increasingly using at work is CAD software. I want to buy a computer (£500 ish) to try and do some work at home, beef up my skills and make myself as useful as I can for the company - its going through tough times atm and CAD engineers are being sought after!
Before I go down this route I want to know how much it will cost me. My umbrella company will charge me 10% as it is a benefit in kind, but I want to know the real world effect on my take home will be. If I spend £500 and it costs me £450 in total at the end of the month i wont bother.... but if the price drops to something 'reasonable' then I will take the gamble to get some practice on the software!
Software wise I am sorted!
Due to my pay being all over the place the last few months, missed some expenses, claimed them back, student loan kicked in, moved house etc I dont have a baseline figure ti work out how much I 'make' off my business expenses!
Does anyone know how I work it out?
Before I go down this route I want to know how much it will cost me. My umbrella company will charge me 10% as it is a benefit in kind, but I want to know the real world effect on my take home will be. If I spend £500 and it costs me £450 in total at the end of the month i wont bother.... but if the price drops to something 'reasonable' then I will take the gamble to get some practice on the software!
Software wise I am sorted!
Due to my pay being all over the place the last few months, missed some expenses, claimed them back, student loan kicked in, moved house etc I dont have a baseline figure ti work out how much I 'make' off my business expenses!
Does anyone know how I work it out?
If you are not running a limited company and VAT registered, I would just buy it from your personal money or, as it is an investment in your future, look to get a 0% finance deal on it.
For the amount you are talking about its not worth the hassle for the tax you would save, I assume this would be in the region of 20% so, £100 best case.
For the amount you are talking about its not worth the hassle for the tax you would save, I assume this would be in the region of 20% so, £100 best case.
Gassing Station | Jobs & Employment Matters | Top of Page | What's New | My Stuff