Calculating Trading Profit

Question 1

How do you treat payment to staff, pension and training?

Answer 1

Allowable

Question 2

How do you treat a specific impaired debt?

Answer 2

Allowable

Question 3

How do you treat writing off a bad debt?

Answer 3

If trade related allowable

Question 4

How do you treat capital expenditure?

Answer 4

Repairs and maintenance is allowable
Everything else is disallowable including legal fees acquiring asset

Question 5

How do you treat charity entertaining and gifts?

Answer 5

Allowable if charity given to local charity and stock to school. Disallowable if to political or national charity.

Allowable, if entertaining or gifting staff
Disallowable, if entertaining client or customer (unless less than 50 not food and is advert)

Question 6

How do you treat trade related professional services

Answer 6

Allowable (inc finance patent lease)

Question 7

How do you treat rent, lease, hire

Answer 7

Allowable (15% disallowed if over 50g/km)

Question 8

How do you treat interest on borrowing and late tax

Answer 8

Borrowing is allowable
Late tax is disallowable