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£250 here
£250 at my employer (£4m t/over)
Previously £1000, turnover £32m
Horses for courses.
Below that Items get expensed - but added back in tax calcs.
Expensing
£250 at my employer (£4m t/over)
Previously £1000, turnover £32m
Horses for courses.
Below that Items get expensed - but added back in tax calcs.
Expensing small capital items is more trouble than it's worth if you are going to treat them all as capital for tax purposes. The orthodox approach is for the de minimis limit, whatever if is, to apply for all purposes including tax.
I have seen both approaches.
Expensing small capital items is more trouble than it's worth if you are going to treat them all as capital for tax purposes. The orthodox approach is for the de minimis limit, whatever if is, to apply for all purposes including tax.£250 at my employer (£4m t/over)
Previously £1000, turnover £32m
Horses for courses.
Below that Items get expensed - but added back in tax calcs.
I get where you are coming from John, but this avoids our fixed asset register getting clogged up. All the items are expensed to one of two codes (small tools / IT) - hence relatively easy for the auditors to pick up the total amount to add to the pools. In our case we are only talking about 20 purchases or so per annum in these expense categories.
It may be that they don't in fact get added back - something to check. I know that in my previous employer the small tools were added back though.
You might be interested in the discussion at this link...
Regards,
Ian
Onion Reporting Software Ltd
Sage accounts in Excel to go
Depends
I've a £200 rule of thumb but I don't stick to it hard and fast. I'd capitalize less for a very small business.
Judgment call.
Surprised by the above, we tend to recommend expensing everything below £500, and quite often up to £1,000. Our clients have turnovers typically in the high tens/low hundreds of thousands.
Since AIA, the tax treatment is no different whether you expense or capitalise, so as far as I'm concerned HMRC have no interest in encouraging the little guys to capitalise everything like they perhaps used to be.
I don't see the benefit for anyone in capitalising something at (say) £250.
Year 1 depreciation
so if captialising - at least a Fxd Asset register record is held, but what is the depreciation policy and its application ?
if acquiring a £1000 or £ 250 computer or tools, say in month/period 12 [ of 12] .. do you Depreciate one month or 12 for the financial year
the result would be on the balance sheet a near zero NBV vs expensed in the p+l