Is there a minimum capital amount under which equipment can be written off as straight expenses or what other rules/guidance applies to this?
Replies (3)
Please login or register to join the discussion.
Whether an item is capital is a question of fact so I don't think there is any minimum. In practical terms though most tax advisers will have a figure they use. I don't claim CAs on anything that costs less than £350 but I expect most others will set the bar higher than that.
With AIA
the tax effect can be the same, but sometimes capitalising an item can be of benefit as capital allowances can be delayed until a later year, when profits are possibly higher, rather than wasting them in a year when pre CA profits are already covered by the trader's personal allowance.
AIA is only available in the year of acquisition but WDAs will be available in later years on any unclaimed amount.
Small Pools Under £ 1,000
Some guidance here as to what can be written off for small pools.
http://www.hmrc.gov.uk/manuals/camanual/ca23220.htm
and here: