Mileage Expenses/Sole Trader

Question asked by Alan Bennett 2 years ago

I'm a sole trader. This question has two parts:

1) When I create a mileage expense it appears in my purchases on the home page. If I pay nothing this is always an outstanding bill but does it still reduce my taxable income because it is classed as an expense? It would be annoying to have it always showing as outstanding so do I then just transfer the money into my personal current account to clear the debt?

2) I'm VAT registered so when I claim my 45p per mile should I add the HMRC VAT rate?

mileage
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5 Replies

Hi Alan,

This should still reduce your taxable income if you are on invoice account. Paying it would be a matter of marking it as paid out from the business account, which in reality would be going to yourself.

This is correct. The HMRC rate is what you would use if you are VAT registered.

All the best,

Mohamed.

Best answer
2 years ago

Hi Mohamed, When you say marking it as paid out I presume I still have to transfer the money out of my business account into my normal account for it to balance out.

2 years ago

Hi Alan,

This would likely be the case but you might not have or need to have your personal account recorded in Clear Books if this is not used for the business at any stage.

All the best,

Mohamed.

2 years ago

Yes, I don't have personal account listed in Clearbooks. I would simply pay it out to it as if I were a supplier.

2 years ago

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