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Cash Basis - Computer Purchase

Advice for confirming on how to record computer for Cash Basis

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Hi there,

I am using Cash Basis and want to account for some of the cost of a computer that I have purchased. HMRC website says that " Unlike traditional accounting, you claim other equipment you buy to keep and use in your business as a normal allowable business expense rather than as a capital allowance. ".

I would say I am currently using the desktop 50-50 for business/personal but this will probably change and become more for business use soon.

As far as I can see, I can put 50% of the cost of it on my accounts as a regular expense. Would anyone here have any knowledge they could help with?

Background:
Have been registered self employed for about 10 years but the last 3 have been almost no self-employment income, with most of income coming through PAYE paid job. I am getting the self employment moving again and purahcased a desktop to various things on in relation to the business and my own personal use.

Replies (9)

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RLI
By lionofludesch
25th Nov 2021 18:29

Are you likely to be a taxpayer in the year of purchase ?

If not, it might be time to drop cash accounting like a hot potato.

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RLI
By lionofludesch
25th Nov 2021 18:34

.

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By Leywood
25th Nov 2021 18:34

[quote=Jamz99]
. Would anyone here have any knowledge?

Yes.

This is a forum for Accountants to speak to other Accountants, so there are plenty of folk on here who have the knowledge.
But as you have wandered in, despite not being an Accountant, it could well mean that someone answering you might not be an Accountant and will then give you an answer worth fluff.

I take it you were asking for a quote from one of the said Accountants?

Agree with Lion though.

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By Paul Crowley
25th Nov 2021 20:10

So many disavantages when using cash basis
I have no clients that use it
I have also never taken over a client from any accountant that used the cash basis

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Replying to Paul Crowley:
RLI
By lionofludesch
25th Nov 2021 20:27

Used almost exclusively by DIYers who don't understand the disadvantages.

It's a bit of an HMRC con-trick.

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Replying to lionofludesch:
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By Paul Crowley
26th Nov 2021 11:29

Agree
HMRC website seems to deliberately encourage it
If we did that then PII would pay out unless we warned client in writing in very plain English

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Replying to Paul Crowley:
RLI
By lionofludesch
26th Nov 2021 11:33

Paul Crowley wrote:

If we did that then PII would pay out unless we warned client in writing in very plain English

A very good point.

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Replying to Paul Crowley:
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By Hugo Fair
26th Nov 2021 22:30

Of course they're encouraging it - indeed some of them seem unaware that there's any other type of basis, which no doubt is why MTD has been designed the way it has (using the word 'designed' in its very loosest sense).

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Replying to Hugo Fair:
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By Paul Crowley
27th Nov 2021 01:43

Everything from HMRC on MTD suggests cash basis approach
Otherwise they would need to admit that annual adjustments need to be done 4 times a year, hence seriously more than double fees needed
MTD the immoral con of the century

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