Reply to: Mobile phone battery - p11d treatment

[BolshieBastard]

It's not the money it's the principle.

I would get a new accountant as it's clear your accountant is stuck in the technology dark ages.

Your accountant should only be querying you on things that clearly could have no business use. A mobile/smartphone battery, a battery pack or even a usb cable clearly has.

My accountant only queries me on courses and once he sees the course name leaves me alone.

I was going to post that yesterday but my post was less polite than those who already posted and the above.

Behave yourself! I wouldnt even consider claiming this. In fact, I dont even claim for the cost of my mobile phones which would save considerable more than a couple of quid on a ten quid battery.

Im pretty sure my accountant would allow the 10 quid claim but even if he didnt, I know his overall advice is what keeps the taxman at bay but, each to their own I suppose.

[mudskipper]

You would like me to be wrong but in fact you are wrong.

There is no charge to tax where the phone is used for business and private calls are insignificant.

Where the phone is used both personally and for business the duality of purposes rules means that there is a charge to tax via Form P11D.

I've included a link to S.336 of ITEPA 2003 for your information:

Income Tax (Earnings and Pensions) Act 2003

Try to read the legislation before calling someone wrong.

Generally, that is true. However, mobile phones are exempt from the legislation, as long as only one phone is supplied and the phone is in the company name.

https://www.gov.uk/expenses-and-bene...s/whats-exempt

https://www.gov.uk/government/upload...8/480_2015.pdf - see page 83.

22.4 which refers to no significant private use is only relevant where more than one phone is provided - it makes it clear that a single phone does not have to pass this test.


Edit: missed the replies from SueEllen and TCP - what they said!

[TheCyclingProgrammer]

You would like me to be wrong but in fact you are wrong.

There is no charge to tax where the phone is used for business and private calls are insignificant.

Where the phone is used both personally and for business the duality of purposes rules means that there is a charge to tax via Form P11D.

I've included a link to S.336 of ITEPA 2003 for your information:

Income Tax (Earnings and Pensions) Act 2003

Try to read the legislation before calling someone wrong.

No, he is right. One phone can be provided for both business and personal use with no reporting or tax implications.

There is no limit on the number of phones that can be provided for business use only, so long as the wholly and exclusively rule is met (and any personal use is insignificant as per s316). Therefore the normal asset rules apply to additional phones, but not the first one as this is exempt under s319 so long as the phone (and any contract) is in the company name.

If your accountant hasn't told you this, perhaps YOU should get a new accountant?

Try reading the legislation before you call someone wrong (you were only three sections away):

http://www.legislation.gov.uk/ukpga/2003/1/section/319

https://www.gov.uk/expenses-and-bene...s/whats-exempt

http://www.hmrc.gov.uk/manuals/eimanual/EIM21779.htm

[SueEllen]

You're wrong

As long as you supply one phone and the contract is in the company name, the phone can be used for business and personal use.

In his case he can be wrong as he isn't the OP's or our accountant.

The links below prove how wrong he is -

Linky on mobile phones, booklet 480 on how expenses are allowed linky (chapter 22) and information about the original notice on smartphones.

[JB3000]

You're wrong

As long as you supply one phone and the contract is in the company name, the phone can be used for business and personal use.

You would like me to be wrong but in fact you are wrong.

There is no charge to tax where the phone is used for business and private calls are insignificant.

Where the phone is used both personally and for business the duality of purposes rules means that there is a charge to tax via Form P11D.

I've included a link to S.336 of ITEPA 2003 for your information:

Income Tax (Earnings and Pensions) Act 2003

Try to read the legislation before calling someone wrong.

[mudskipper]

The battery is simply a repair to an asset (rather than the addition of an asset in its own right) and therefore should not be subject to P11D rules.

Personal use of a company phone or company PC provided to an employee is subject to P11D rules (cash equivalent is 20% of the value of the asset).

However the battery and phone should not be accounted for separately and class 1A NIC and income tax (if applicable) paid on both as they are one asset together (not two separate assets).

Time to get a new accountant if your accountant feels the need to harass you over this complete non-issue. If he's calling you up on this goodness knows what else he will start picking on you about.

You're wrong

As long as you supply one phone and the contract is in the company name, the phone can be used for business and personal use.

[TheCyclingProgrammer]

Personal use of a company phone or company PC provided to an employee is subject to P11D rules (cash equivalent is 20% of the value of the asset).

?

A single company phone provided to an employee can be used for personal calls with no tax implications.

Likewise, a company PC, if provided as necessary to do the job, can also be used for personal reasons with no tax or reporting requirements (use is not considered significant so long as wholly and exclusively rule for original purchase is met).

Agree with everything else though.

[PerfectStorm]

I wouldn't have even thought to question it - phone accessories etc. would seem to be a reasonable expense so I don't see why this would be.

As for those saying just buy it yourself - why would an individual buy replacement parts for their employer? You wouldn't would you? Keep it as a wholly company expense, which means company picks up the tab.

[JB3000]

I'm in dispute with my accountant over the treatment of a circa £10 valued mobile phone battery that was bought as an employee expense to repair the company iPhone.

I see it as part and parcel of the mobile phone and thus not attracting any tax to pay/does not need to be reported.

My accountant's view is that the mobile phone battery is an asset used for both personal and business use, and thus needs to be reported and will also attract some class 1A tax.

To clarify: This expense is a replacement mobile phone battery only. The mobile phone itself is provided for free as part of a business contract in the company's name.

Interested to know others views!

The battery is simply a repair to an asset (rather than the addition of an asset in its own right) and therefore should not be subject to P11D rules.

Personal use of a company phone or company PC provided to an employee is subject to P11D rules (cash equivalent is 20% of the value of the asset).

However the battery and phone should not be accounted for separately and class 1A NIC and income tax (if applicable) paid on both as they are one asset together (not two separate assets).

Time to get a new accountant if your accountant feels the need to harass you over this complete non-issue. If he's calling you up on this goodness knows what else he will start picking on you about.

[SueEllen]

Phones are a bit of an oddity because of the exceptions allowed a couple of years ago with smart phones.

Sounds like your accountant is taking this as an extra battery so you can swap when yours runs out. You could argue that just making calls for work wouldn't require a second one so he's going on that so can see his point.

<snip>

Point is why is the accountant bothering?

Also the excuse you gave for the accountant querying it is illogical.

You can be on the road with no sockets you can plug your phone into to charge it, which is why you need an extra or external battery. This means you can't make and receive any calls, emails or messages regardless if they are work or personal ones.

[northernladuk]

Phones are a bit of an oddity because of the exceptions allowed a couple of years ago with smart phones.

Sounds like your accountant is taking this as an extra battery so you can swap when yours runs out. You could argue that just making calls for work wouldn't require a second one so he's going on that so can see his point.

You could just be buying a replacement as the old one is goosed. That's essential to the operation of the phone so should be claimable. If that's the case then thank him for his diligence and his concerns are noted but put it through. Same could be said for the previous situation as well I guess.

Bottom line is for £10 I wouldn't have bothered tbh,

[TheCyclingProgrammer]

It was an aftermarket battery bought from an online vendor and fitted by myself.

Vendor is a Ltd and provided an invoice.

It was not a USB charging accessory, but in fact a replacement internal battery.



Yes they do.



Accountant feels that potential for personal usage of the higher asset causes the battery to fall under the asset rules and attract tax despite mobile phones themselves appearing on the A-Z as not requiring reporting and not attracting tax...

Well, fair enough. Regardless I stand by my original post and can't see how it's a BIK. My accountant certainly wouldn't waste my time over something this trivial. It is, as somebody said, effectively a consumable or even a repair if you like. The battery in of itself is not an asset and even if it was I cant see how the personal usage can be anything other than insignificant (it's not like it can be useful independent of the phone and the rules for phones are pretty clear).

You can have s company laptop or printer which, if bought wholly and exclusively for business purposes, any personal use would normally be deemed not significant and you wouldn't hesitate to put a replacement part or ink cartridge through the business would you?

Finally, as I said before, exlenses paid by an employee on behalf of its employer (like a repair to a company owned asset) do not need to be reported on the P11D either

[SueEllen]

Yeah 10 quid!!! You're arguing with your accountant over 10 quid? Is your rate so poor that you have to put a 10 quid battery through the company to get £2 off your corporation tax bill?

It's not the money it's the principle.

I would get a new accountant as it's clear your accountant is stuck in the technology dark ages.

Your accountant should only be querying you on things that clearly could have no business use. A mobile/smartphone battery, a battery pack or even a usb cable clearly has.

My accountant only queries me on courses and once he sees the course name leaves me alone.

I was going to post that yesterday but my post was less polite than those who already posted and the above.

[BolshieBastard]

I'm in dispute with my accountant over the treatment of a circa £10 valued mobile phone battery that was bought as an employee expense to repair the company iPhone.

I see it as part and parcel of the mobile phone and thus not attracting any tax to pay/does not need to be reported.

My accountant's view is that the mobile phone battery is an asset used for both personal and business use, and thus needs to be reported and will also attract some class 1A tax.

To clarify: This expense is a replacement mobile phone battery only. The mobile phone itself is provided for free as part of a business contract in the company's name.

Interested to know others views!

Yeah 10 quid!!! You're arguing with your accountant over 10 quid? Is your rate so poor that you have to put a 10 quid battery through the company to get £2 off your corporation tax bill?

[Scruff]

I put every mobile accessory, replacement batteries, digitisers, battery banks through and never queried by my accountant. I have had to purchase phones in short succession too, since I have left them in Datacentres, lost them etc (3-4 in one year). They are never capitalised either.

You need a new accountant.