Capital vs Revenue expenditure

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Hi, can i capitalise the cost of electrical certificate for work which relates to leasehold improvements, such as new lighting and sockets? If so, can it be listed as a separate item on the fixed asset register or should the cost be added to the total cost of improvements? thank you

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By paul.benny
06th Nov 2020 12:03

How much are we talking about here? Just possibly you might include it as part of the entire electrical project, but really the whole lot sounds like revenue expenditure.

Tax treatment may, of course differ.

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Replying to paul.benny:
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By NatBee
06th Nov 2020 12:38

Certificate cost is £60, so not a lot. However, it is more about, whether this can be included or not? I feel that installation of new lighting is an improvement rather than a repair and therefore should be classified as leasehold improvement. same applies for installation of new sockets. Do you disagree? thank you

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Replying to NatBee:
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By Truthsayer
07th Nov 2020 09:47

Only you know the full facts, so you are best placed to make this judgement. It is a very minor decision, and of the sort that an accountant has to make all the time. Just do it. There is no point in asking us.

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Replying to NatBee:
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By DJKL
07th Nov 2020 11:21

What was in place before the new light fittings/sockets etc?

How long has the party had the premises, has the need to replace arisen over the time they have occupied the premises or was it required at date of entry/acquisition?

What were the premises used for prior to acquisition, were they used for the same sort of thing, were they in a fit state to be used etc, or is their purpose being changed/modified etc?

A bit of context might assist.

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