04/05 tax return

Hi,

I have a website that generates a certain amount of income (see the sig-line below) and the 04/05 tax year would be the first year that I would have to file a return for these earnings (Yes...I know I've left it a little late).

I haven't yet set up a limited company for this so I am filing a set of self-employed pages. I have a couple of questions regarding this return that I wonder if any of you can help out with:

(1) Pre-existing equipment.

I originally purchased a computer, router, printer etc... for another purpose prior to starting the website. However, since the website started these items have been used solely for the website business. How can I account for their depreciation in my return? e.g. if they were originally purchased in the 2002/2003 tax year for, say, £2000 what value would be ascribed to them if they were brought into the business in the 2003/2004 tax year and, assuming that these items have never been depreciated on any previous tax return, would I be allowed a first year depreciation allowance against them in the 2004/2005 tax year?

(2) NI

If my earnings were, say, £10,000, would class 4 NI liability be £420.40 (8% on the earnings above £4745) or £800 (8% on all earnings)?

Also, I have been a little remiss about notifying the IR about my self-employed status. I know that this means that I will ahve to pay a £100 fine. Anyway, I know that there is a SEE for those earning not very much. Is this exemption limit fixed regardless of the percentage of the year that the business was operational or will it be rated pro-rata? The reason I ask is that the business started sometime during the 2003/2004 tax year and the income from the website that year was below this threshold. However, the website income would be above the pro-rata rated amount.

To clarify things...if the business was only operational for, say, the latter half of the tax year and by April it had earned just below the SEE limit, would I be exempt from NI for these earnings for that year.

cheers,
RM
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