rent, utilities and insurance reported as disallowable

Hello there!

Let me share some information on how QuickBooks Self-Employed (QBSE) tracks allowable and disallowable expenses.

QBSE tracks rents, utilities, and insurances as disallowable expenses for private or non-business portions of these expenses; cost of buying business premises. Thus, it only tracks these account detail types as allowable expenses for business premises; business and water rates; light, heat, power costs; property insurance; security; and use of home as office (business portion only).

If you want to track them as allowable, I recommend seeking help from your accountant. This way, they can guide you on how to track it.

I'm adding this article for more information: Allowable and disallowable expenses explained.

Come back to this post if you have other concerns or follow-up questions about this. I'm always here to help.

Hi,

I am entering the % for council tax and energy costs for use in my home office which is 1/7th of the monthly payment yet when I put under rent/utilities it comes up as disallowable. I have tried adding it as a home office expense and it still comes up as disallowable.

Having checked on the HMRC website, I can add these an expense but it is not logging correctly, please advise?

Nice to see you join this thread, kelly.

I can share with you some insights on how to isolate and get around this issue. 

I recommend logging out and logging back into your QuickBooks Self-Employed (QBSE). It refreshes your account for the updates to take effect. 

If this is not the case, I suggest accessing your account in a private or incognito mode. This way, we can check if this is a browser cache issue. The browser uses cache data to swiftly load web pages faster. However, too much of it causes issues that affect the views and performance of your account. 

Using a private window helps us verify the issue as this doesn't save any data files. You can refer to these keyboard shortcuts in opening an incognito window.

• Ctrl + Shift + N for Google Chrome browser)
• Ctrl + Shift + P for Mozilla Firefox & Microsoft Edge browsers
• Command + Shift + N for Safari browser

Once resolved, I recommend clearing your regular browser cache. Doing so deletes all the data from your browser and optimizes its performance. Using other supported browsers also helps us verify if this is a browser-specific issue. 

I'll be around if you need more help running your accounts ow with your QBSE. Keep me in the loop by tagging me in your reply. Keep safe!

I am also having the same issue with Car/Van/travel expenses for things such as Van insurance which are not being classed as Allowable expenses even though they should be. I am currently categorising these as 'Other business expenses' so they show as an Allowable expense, but is there a way to change this as it would be alot easier to track under the correct category without having to get round this issue.

Also I am declaring full invoices as Business income (Labour + Materials) as when I try to do a split bill it takes the materials cost (cost of goods for resale) off my total income even though it should be included. Shouldn't Labour and materials be classed as Total income and then the materials (cost of goods for resale) be additionally categorised as an expense?? 

If you could help clarify this as I'm new to QuickBooks but I'm fairly certain this isn't correct, I am a self employed Carpenter if that helps at all, Many thanks.

The Community forum welcomes you, John, as its newest member. I'm here to explain and share some information about having the availability of manually assigning transactions as Allowable or Disallowable in QuickBooks Self-Employed (QBSE).

QBSE automatically determines whether an expense is allowable based on your tax profile, so you don't have to adjust or classify them manually. Since you mentioned the expenses in question should be classified as Allowable, yet they're showing as Disallowable, I recommend reviewing your bank rules settings. This feature is designed to automate the categorization of transactions, which can significantly streamline your bookkeeping process. However, in some cases, this automation might lead to unexpected results.

Meanwhile, since these expenses should appear as Allowable, we'll want to recategorise them as Travel expenses or continue classifying them as Other business expenses. This approach will enable the system to recognize these transactions as Allowable Expenses on your tax documents. Alternatively, you can use the bank rules to streamline the categorization process. By setting up specific rules, your van insurance transactions can be automatically classified as Allowable expenses, eliminating the need for manual intervention.

I'll add an article about the differences between allowable and disallowable expenses. Defining these terms and providing examples will help business owners navigate the complexities of tax deductions and ensure compliance with tax laws: Allowable and disallowable expenses explained. 

Regarding your second inquiry about the suitable classifications for your Labour and Materials, as well as materials or cost of goods for resale, I strongly recommend you seek the guidance of a qualified accountant. An accountant can assist you in ensuring your financial records are precise and compliant with relevant tax regulations.

Remember, John, accurate record-keeping and proper expense categorization are essential for maintaining a healthy financial standing and avoiding potential issues with tax authorities. In this case, I'll keep this thread open so you can ask additional questions about specific categories and classifications in QBSE. In the meantime, take care and keep safe.

Thanks, I've just changed my profile settings and had a look at my bank rules but unfortunately this doesn't seem to fix the issue, I will just manually categorise these payments into 'other business expenses' so they show as allowable. Regarding the 2nd enquiry I have consulted an accountant and I am up to date on all government guidelines on how total income Vs materials expenses should be reported, my query was more how I can have this show correctly on the app, if it's not possible for whatever reason I will take note my self of the split bill for my end of year accounts, thanks for your help.

Hi John. To be honest I just use three categories now. Other, travel and advertising and website. It’s just simpler. You can’t use qb for any analytics it’s completely useless 

Honestly mate the condescension in these so called experts messages is on another level. Just remember QB is very basic. It does just enough for the cheap price. Other than that yiu just p in the wind mate.