Hi,
I'm self-employed, sole trader working from home (based in Australia) - I'm trying to calculate a rough estimate of my income tax I need to put aside from business earnings - so I can start making regular payments towards my income tax.
I understand the basics of how much I can deduct for tax purposes (what I can claim etc) and know I need to go over these with a tax accountant near tax time etc.
However, I'm confused about how to record these in Quickbooks in the meantime - as they are only partially allowed for tax deductions (a percentage) because I run a website e-commerce business so I work from my home (use the same computer etc. for business and private use).
For example:
Home Utilities - like electricity are used for both personal and business use.
My question is:
When I go to transactions in banking and say make a payment to my electricity bill that was due e.g. $150
- only a portion of this amount is allowable tax deduction - but when I categorize the bank transaction as "expenses > utilities" - it puts the entire cost paid by me into my profit and loss statement.
So I'm not really sure how to do it on a profit and loss so I can work out my taxable income more accurately.
My graphs etc on the QB dashboard also then shows I have alot of business expenses and much less net income etc - when really most of these expenses were used for both personal home living and my business activities?
How do I process these lump sum bill payments like electricity or rent etc in QB & clean up my P&L reports so they more accurate reflect the real business expenses incurred and not my home private use?
Thanks
