Starting your own business from scratch is expensive. There are plenty of set-up costs you’ll need to foot the bill for, which means you’ll start racking up expenses before you’ve started bringing in any income to cover these overheads.
So can you claim these pre-trading expenses back? The short answer is, yes!
You can claim back any pre-trading expenses as long as they meet the same conditions of your post-trading expenses – i.e. that they’re related wholly and exclusively to the running of your business.
How far back can you claim for?
You can go back seven years prior to when you started trading too, as long as the items in question were listed as an asset, and for capital allowances, from your trading start date. So it’s worth going through your pre-trading expenses to look for large costs like laptops, equipment and vans etc. to check if these can be claimed back against tax
Any personal assets that you’ve brought into the business will be treated differently to items you’ve bought through the business. For example, if you’re using a computer that was bought from your personal account, this will be treated differently for tax purposes than a computer bought through the business’s bank account.
Capital expenditure on things like land and property can’t be claimed, as a general rule, although money spent on equipment can be claimed in most cases.
If you need help claiming your pre-trading expenses, give us a call on 01454 300 999 or drop an email to firstname.lastname@example.org