Question about expenses
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  1. #21
    ASB
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    Quote Originally Posted by shtek View Post
    Thanks ASB for comprehensive answer, I am not sure this will be sop attractive option if I incur tax.
    My plan was to put it as a business expense, ( office construction) obtain the necessary invoice and not incur tax. So you saying there is no way around it ?
    Let us, for a moment at least, assume it is actually an office.

    What you are doing is buying an asset. In this case property.

    Since it is an asset it is not an expense and not chargeable to CT. Thats the way it goes. However what is chargeable to CT is the diminution in value of the asset over time (conversely any profit over time would cause a CT liability to arise - the profit element is income).

    There is a depreciation rate you can use for capital allowances, I think it might be 3%, but that is just for providing a temporary book value and it should be properly value periodically. If you can be bothered (I certainly can't) you can look up the full treatment on HMRC.

    So, in answer to the question you post:- NO. The end.

    [It is depreciation that can be charged to tax as I have now explained twice].

    Now, if it is not an office there are a host of personal taxation consequence to be considered too. Some of which I outlined.

    Now, I know your mate will give you a receipt that says "To: Building new office 20k". I am not sure that either of you realise the extent of criminality in this. To wit:-

    - False accounting
    - Various forms of tax evasion
    - Conspiracy

    I'm sure there are plenty of others that could also occur.

    It is perhaps not the wisest thing to publish your joint intents on a public forum.

    Of course the other side of the coin is you have to get caught. Buy any tax inspection is likely to want a solid paper trail. Curiously when faced with this sort of thing the aveage tax inspector is unlikely to say "yes, that's fine I accept that". They will tend to want to see the asset.

    At the end of the day it's your bum you might want to protect in the shower block. Not mine.

  2. #22

    I live on CUK

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    Quote Originally Posted by shtek View Post
    Would you than say ,: Dont do it ?
    STOP!!!

    No don't do it.

    Build the extension out of your personal funds. Then if your business requires you to work at home more than 3 days per week have a talk to your accountant about office furniture.
    "You’re just a bad memory who doesn’t know when to go away" JR

  3. #23

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    Quote Originally Posted by shtek View Post
    Would you than say ,: Dont do it ?
    Go ahead and do it, and do it BIG!! What could possibly go wrong?


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    I was looking at having an extension built and asked my accountant if I could claim as there's going to be an office as part of it. He said that it's better not to given the tax implications and the business then technically owning part of the house and the complications involved. Don't bother was the general advice.

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    Include the penis extension and you can get a right cock-up in the deal!
    We have a poverty of intellect....
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    Quote Originally Posted by northernladuk View Post
    Just ban this bloody awful sockie. If it's not a sockie just ban it anyway to be sure.
    I never told cojak about your psychocandy sockie, have I?

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