Fixed Assets - starting Values to capitalise

Fixed Assets - starting Values to capitalise

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What value do people start capitalising fixed assets - SME?

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By tom123
14th Feb 2015 08:06

£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.

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Replying to Hannahmc8:
By johngroganjga
14th Feb 2015 13:14

Expensing

tom123 wrote:

£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.

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Replying to Matrix:
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By tom123
15th Feb 2015 09:52

I have seen both approaches.

johngroganjga wrote:
tom123 wrote:

£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 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.

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By Onion4Sage
14th Feb 2015 10:24

You might be interested in the discussion at this link...

BKN

Regards,

Ian

Onion Reporting Software Ltd

www.onionrs.co.uk

Sage accounts in Excel to go

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RLI
By lionofludesch
15th Feb 2015 09:55

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.

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By beanstar
16th Feb 2015 09:27

Thanks for your responses.  I

Thanks for your responses.  I was thinking in and around that level.

thanks

 

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By Maslins
16th Feb 2015 09:54

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.

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By kiwilondon99
16th Feb 2015 11:32

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

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RLI
By lionofludesch
17th Feb 2015 11:43

Near zero NBV ?

What ????

And what rate of depreciation are you using ?

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By johngroganjga
17th Feb 2015 12:07

Must be 99% per annum!

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Replying to tom123:
RLI
By lionofludesch
18th Feb 2015 10:27

Ha ha !!

johngroganjga wrote:

Must be 99% per annum!

At least !!!!

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