Can software costs be claimed as a business axpense or do they have to be capitalised?
Thank you for any input.
A P
Replies (1)
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It depends!
There is lengthy discussion in HMRC manuals and Bulletins but in short, if the software is being purchased under licence (as is normally the case) then providing the economic life of the licence is 2 years or less HMRC will accept revenue treatment. This applies whether the software is acquired separately or with the computer (though in practice the latter is usually capitalised - at least it is by our clients!)