What are deductible expenses for self in the statement of income?


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Self taxed directly estimate, both in its standard version as simplified, must keep strict control of your income and expenses. The difference between the two quantities determine the tax payable to file your tax return.

Case apart are self taxed objectively estimate (the famous modules). These autonomous pay a predetermined amount and fixed tax, regardless of your actual expenses.

Therefore, if you belong to the first group (like most of the self), surely you’ve often wondered what those deductible expenses that can add to your tax return are.

In this article we reveal the basic keys to see if you can add an expense in your next tax declaration.

Requirements of a deductible expense
Obviously, any expenses you do in your everyday life is not deductible. You know, I mean that dinner last minute you did at McDonalds or collection of tickets gasoline your last vacation trip.

The number one rule to consider a deductible expense is that this has to be linked to your economic activity and also be perfectly justified with the corresponding invoice.

That is, forget to include in the tax declaration the electric bill or phone bill if you can not justify use it solely to exercise your profession.

To give you nothing happens overlooked and you’re prepared in case you have an inspection, it is best to have a billing program where you can record all your expenses and note the reason for its realization.

As a general rule, I recommend not tempted to inflate costs tens of tickets nonsense, because it will be much harder to justify when necessary.

Deductible expenses for self

The main expenses that may have an autonomous are grouped as follows:

Used in Operations: raw materials, fuels, containers, packaging and office supplies, and all that is necessary directly for the development of your business.

Wages and salaries: payments to workers hired for salaries, bonuses, allowances and allowances for travel expenses, compensation in kind,and awards and allowances.

Social security paid by the company: all social security receipts you paid both your name and the name of your workers.

Other staff costs: cost of training, compensation for termination of contract, accident insurance staff, gifts, etc.

Rents and royalties rental, royalties, technical assistance, finance lease payments for land that has no object, and solar or other non-depreciable  assets.

Independent professional services: fees of economists, lawyers, auditors, notaries, etc.

Other external services: expenditure on R & D, transport, insurance premiums, banking, advertising, public relations, supplies of electricity, water and telephone and other office expenses not included in the previous sections.

Tax deductible taxes: property tax (IBI), the business tax (IAE), other state taxes and surcharges and fees, surcharges and state contributions.You can not deducir neither sanctions nor in surcharges or after the deadline for filing your tax returns.

Finance costs: interest on loans and credits, discounting fees, surcharges deferment of debts, etc.

Amortization: all your business assets lose value over time. The loss of that value can be applied as a deductible expense. Its calculation shall be as stipulated in the corporate tax.

Other deductible expenses: books and professional journals, costs attendance at courses, congresses and conferences, business association fees, etc.

Common questions
Most self-employed have a number of expenses that always generate doubts. These are expenses related to home address, vehicles and travel.

If you work from your own home, you’ll deducible the proportion of the surface you use to develop your business in the following expenses:

  • local taxes related to housing.
  • expenses of the community.
  • Property insurance.
  • depreciation of the home.
  • mortgage interest.

If the house is for rent, then you should ask your landlord to make you a deal with VAT, at least for the percentage of the home that you use for work. Rental contracts for local businesses are taxed at the tax.

Regarding housing supplies (water, electricity, telephone, etc.), you need to have separate counters for activity and for your personal use.

As for your own car, you can only  generates expenses (including gas, insurance, etc.) if you use 100% for your professional activity. And I assure you that’s pretty hard to justify.

Finally, you’ll desegregate all costs of travel, accommodation and meals that you had during a business trip. The only condition is that, as the name suggests, is a work trip. So forget to add this getaway weekend 🙂

As always, when in doubt, it is best to consult a professional advisory service. If you want, you can count on our online tax advice. So you can focus on your business and not really paperwork;)