Posting part of receipt for fuel to Wave (part private)
Nick_Willder
Member Posts: 4
Hi Community.
I'm a newbie looking to be pointed in the right direction by a kind soul.
I do a little private business from home in my spare time and use Wave for the accounts. I scan my gas station receipts with my smart phone for posting straight to Wave, but only a small fraction of the cost is eligible as a business use (the rest is my private motoring). How should I process these gas receipts within Wave?
A related query: I am allowed to 'charge' my business with a nominal rent for my home-office, and some heating/lighting costs. How should I process this in Wave?
Thank you in advance
Nick
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Great question, @Nick_Willder ! I think your best bet here would be to find this expense under Accounting > Transactions, and then select 'Split Transaction' under the drop down menu to the right of this particular transaction. You can then assign the separated business and personal sides of this transaction to its associated categories.
With regards to your next question, I'd like to get a little more insight into the exact process in which you charge your business rent and expenses e.g. are you transferring directly from your business account to your personal account? This will help to decipher if this is a regular income transaction vs something a little bit more complicated!
Thank you Michelle. I'll look at splitting the fuel transactions. I calculate I am allowed to 'claim' just 2½% of my motoring costs for business. As there are quite a lot of receipts, would you think another option is to total them all up at the year end, then create a transaction for minus 97½% of the whole value posted to the same account?
As for home-office costs (e.g. nominal rent, plus heat, light, property tax); why don't I just make a charge to the business from me (create a bill) and then withdraw the funds from the business into my own personal bank account? Would that seem to represent the truth of the matter to you?
2 1/2% is not much, I would keep a travel log on your mileage. I am Australian but this would still suit you in the States.
In Australia we keep a daily log for three months of all personal and business travel then use that as an average.
In Australia they like to say 10% of your claimed business cost is personal fuel cost, I argued that as I was taken to work by my employer and when home I was working my business I had a shift 4 days on 4 days off so I worked my own business a lot and I said that 2% was personal use and they agreed.
By doing a 3 month travel log you know what you are doing and spending, remember tyres and tune ups work out the % of business and personal use.
As for you nominal rent thats ok if you are renting property, but if its your own house we in Australia loose out as the gov dosn't let you have the total funds and not have to pay Capital Gains Cost. So were its your own home and u sell it there is no Capital gain cost, but if you change the business nominal cost its classed as commercial and you have to pay capital gains when you sell the private property. Just something to think about
Dear Ozdownunder
Thanks for that really spot on advice. Actually I'm in the UK (I used 'gas' instead of 'petrol' to avoid confusion). I have a 3-day a week 'normal' job, and am self-employed for the other 4 days in a week! But I don't do a great deal of travelling for the private work. 2½% is realistically all it's worth, erring on the cautious side and saving the ball-ache of recording all my mileage spread across my clapped-out van, my car and my motor bike. The heads-up on Capital Gains is bang-on. It is an issue. But a casual bit of research led me to a thing called "Entrepreneurs' Relief" which seems to apply gains tax at half the normal rate to my sort of business. I'm gambling that it applies to me. I'm unlikely to need it, but if I do sell up and I'm not eligible for the lower rate, I'll just end up back at the normal rate, offset by my earlier income tax savings.
Cheers
Hi @Nick_Willder
You would be far better to record the business mileage in whatever vehicle you choose to use at the time as you can claim a deduction from your profits for this at the HMRC approved rates of 45p per mile for the first 10k per annum, 25p per mile thereafter.
Use of home as office claims do not automatically trigger capital gains tax issues, bit of a red herring there. HMRC have scale rates for such a claim but these are based on the hours spent conducting your business at home. The alternative is to work it out from the total of your household bills and looking at how much space you use for the business at home.
Regards
Andrew
myaccounts.co.uk