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Profit is how much money you’re left with after you’ve subtracted costs from your earnings.
You don’t talk about making profit when you’re only a full-time employee with no other earnings. Knowing your profit is important because that is what HMRC will tax you on.
If your costs are higher than your earnings, you’ve made a loss. That’s not great, but sometimes you can use it to offset a profit next year and pay less tax then.
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