What are the guidelines for assessing if its depreciated or appreciated
Continuing with the example of a garden office, should you have it for over a decade or even two and it were to fall into a condition where is was no longer viable as an office. Can you make your own assessment of its value?
Or sell it back to yourself at a price the company was happy to accept?
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Leeway with 'wholly and exclusively for business use' regarding furniture?
Collapse
X
Collapse
-
Originally posted by d000hg View PostNo idea. Why wouldn't you? They are a depreciable asset though I don't know over what terms. A log cabin or shepherd's hut or something of that type, which are extremely popular now, are typically not expected to last as long as a typical house so why would you not want to recoup the expenditure? And my point was if it has reached zero(ish) value by the time you move, couldn't the company then write it off/give it to the house owner?
You would need to revalue the property on an annual basis, just like you revalue your computer equipment by running depreciation journals.
With something like property an assessment would be done against the actual sale price of comparable properties in the area. IANAA but I would look at the whole property (office + dwelling) value and compare the change in value since date X when the office was built. Then attribute the change in value according to sqft so if the office is only 5% of the total sqft of the whole property then its value is adjusted by 5% of the total change in value (it makes sense in my head but I may have explained badly).Leave a comment:
-
Originally posted by d000hg View PostNo idea. Why wouldn't you? They are a depreciable asset though I don't know over what terms. A log cabin or shepherd's hut or something of that type, which are extremely popular now, are typically not expected to last as long as a typical house so why would you not want to recoup the expenditure? And my point was if it has reached zero(ish) value by the time you move, couldn't the company then write it off/give it to the house owner?Leave a comment:
-
Originally posted by northernladuk View Post
I don't think you'd put a garden office as a depreciating asset do you?
Leave a comment:
-
Originally posted by Fred Bloggs View Post
Apparently so. Mrs Bloggs overheard his wife bragging about it in the local coffee place to her mates. I doubt anything will happen, they have lived in the same house more than 30 years and I doubt they're moving anytime soon.
It's mildly irritating that there's VAT likely being reclaimed and corporation tax relief on the expenditure. Not a great example of compliance to the rules of the game.Leave a comment:
-
Originally posted by Paralytic View Post
You mean his business paid for his garden office? So long as his accountant is happy with it (they shouldn't be, but some might just let it go), its unlikely he'll ever be found out, unless he's audited by HMRC. But if you want to stir things up, ask him what his business is going to do with the garden office if he sells his house.
It's mildly irritating that there's VAT likely being reclaimed and corporation tax relief on the expenditure. Not a great example of compliance to the rules of the game.Last edited by Fred Bloggs; 11 October 2021, 20:14.Leave a comment:
-
Originally posted by northernladuk View Post
I don't think you'd put a garden office as a depreciating asset do you? It would still be owned by the company and likely to add to the value of the house. He'd have to do some jiggery pokery to transfer it to him personally before selling the house.
https://www.ridgefieldconsulting.co....garden-office/Leave a comment:
-
Originally posted by d000hg View Post
If it has time to depreciate, does it stop being an issue?Leave a comment:
-
Originally posted by Paralytic View Post
You mean his business paid for his garden office? So long as his accountant is happy with it (they shouldn't be, but some might just let it go), its unlikely he'll ever be found out, unless he's audited by HMRC. But if you want to stir things up, ask him what his business is going to do with the garden office if he sells his house.Leave a comment:
-
Originally posted by eek View Post
Why? There has always been a set of workers (field agents / engineers) whose main base was from home...Leave a comment:
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Leave a comment: