Turnover, gross profit or net profit for loan application? gazid

#1
When applying for a loan, obviously you need to enter your income.

As a self employed person I have three figures: Turn over, Gross Profit, Net Profit. Which should I use?



The loan company want to see an SA302 which is essentially a tax return which only shows my net profit, yet gross profit more accurately reflects my actual income and of course, makes me a better prospect for the loan.



Any advice appreciated. Thanks in advance.

#2
How would your gross profit be more accurate than net profit? It sure will be a higher number, but that doesn't make it more accurate - quite the opposite.

#3
The only way gross profit could 'more accurately reflect your actual income' is if you're deliberately making it look to HMRC that you have more expenses than you do, to avoid paying as much tax as you shoudl be tax.

#4



When applying for a loan, obviously you need to enter your income.

As a self employed person I have three figures: Turn over, Gross Profit, Net Profit. Which should I use?



The loan company want to see an SA302 which is essentially a tax return which only shows my net profit, yet gross profit more accurately reflects my actual income and of course, makes me a better prospect for the loan.



Any advice appreciated. Thanks in advance.
Originally posted by gazid


No, gross profit does not more accurately reflect your actual income. Turnover is what your company receives, take off company expenses and that gives you gross profit. Pay Corporation Tax on that, you're left with Net Profit. Unless, of course, you're not paying Corporation Tax ?

#6



No, gross profit does not more accurately reflect your actual income. Turnover is what your company receives, take off company expenses and that gives you gross profit. Pay Corporation Tax on that, you're left with Net Profit. Unless, of course, you're not paying Corporation Tax ?
Originally posted by Ebe Scrooge


Hi, no, I'm not a Ltd company, just a sole trader.

#7



When applying for a loan, obviously you need to enter your income.

As a self employed person I have three figures: Turn over, Gross Profit, Net Profit. Which should I use?



The loan company want to see an SA302 which is essentially a tax return which only shows my net profit, yet gross profit more accurately reflects my actual income and of course, makes me a better prospect for the loan.



Any advice appreciated. Thanks in advance.
Originally posted by gazid


The loan company have told you which figure to use - net profit.



My advice? Do as you're asked.

Who is online

Users browsing this forum: No registered users and 1 guest

cron