Expensing and iPod..

[ASB]

I could do with a bigger Ipod and the New Nokia N95 !

But really I dont see what the benefits are doing such a thing (i.e buying Fixed assets) on a flatRate VAT scheme. correct me if i am wrong but

1) capital expenditures do not reduce your corp tax, except for a little depreciation ?
2) you will only be saving on tax on dividend had you had taken the money out in the first place to buy the fixed asset. But then again the FA is not yours but you company's.

So whats the point, its all a false Economy any way. I would like to buy a bigger 80Gb IPOD and a NOkia N95 (business use off course ) but figures dont look any better buying as a Ltd co. expenditure.

css_jay99

sometimes it can work, sometimes not. Basically you get capital allowances at the usual rate for the asset class in question which reduces the CT liablility, then there is generally a balancing charge/allowance at the assets actual disposal. This being the difference between its book value and the actual price realised.

If you then have personal use this is taxable as a BIK, normally at 10% of the book value. So, this can potentially be a good way of funding rapidly decreasing assets. e.g.

Company buys lawn tractor for 5k. In 2 years it sells it to director for 2k (fair market value). Company saves 600 quid corp tax. Director pay BIK tax on approx 800 quid (160/320).

Essentially therefore the initial depreciation has been paid for out of pretax rather than post tax income. I think now this is something that the HMRC have clamped down somewhat over the last few years so there may be very few things it has any chance of working with. Garden machinery was one.

As ever check current position with accountants.

[css_jay99]

I could do with a bigger Ipod and the New Nokia N95 !

But really I dont see what the benefits are doing such a thing (i.e buying Fixed assets) on a flatRate VAT scheme. correct me if i am wrong but

1) capital expenditures do not reduce your corp tax, except for a little depreciation ?
2) you will only be saving on tax on dividend had you had taken the money out in the first place to buy the fixed asset. But then again the FA is not yours but you company's.

So whats the point, its all a false Economy any way. I would like to buy a bigger 80Gb IPOD and a NOkia N95 (business use off course ) but figures dont look any better buying as a Ltd co. expenditure.

css_jay99

[Gonzo]

did he get away with it?

Yes he did.

His justification was that "he is a big bloke so needs a big screen for giving presentations". The fact that it never moved from his sitting room wall because it took six people to lift it did not seem to matter.

However, I don't know what the outcome of his IR35 dispute was so it could all have been academic.

[freakydancer]

blah

[Maxamus]

I know someone who put their Plasma Screen TV through their company. And that was in the days that they cost 6 grand

did he get away with it?

[Gonzo]

Putting a 42" plasma through the company and claiming its to connect your work laptop to is clearly dodgy... But, what about putting an 80Gb ipod through as an external hard drive backup device? Whilst technically true, I suppose its still pushing it a little.

Thoughts?


(yes I've just bought myself a new one)

I know someone who put their Plasma Screen TV through their company. And that was in the days that they cost 6 grand

[meridian]

OK then, I'm going to claim all my food through the business.

Of course, it won't be called food and drink, it'll be called: business nutrition enhancement and re-fuelling technology.

All DVDs and CDs for personal pleasure will be re-diverted through the business and called: audio/visual business communication enhancement programmes.

Now you're getting into the spirit of being a 'real' business, Denny!

I've mentioned before that my parents run a drainlaying company - they once had to get the Aga rebricked, so put through the expense as "firebricks for the digger"

[Maxamus]

Sometimes i dont have cash on me and i end up paying for my 20 Regal by card. The reciept does not say what i bought. I've always been tempted to put it through like and say it was a book of stamps or some tulip.
But the coward in my is too scared of Gordo

But heres a tip: When paying by credit/debit card, almost all of the time the reciept does not list the item decription. Just quantity and price..........

make of it what you will.


In the mean time. Im running out of space for my DVDs. Think i'll pop down Argos this weekend and get meself a DVD Rack.
Its a cost to the business like because i need it to store backups of all my projects

EDIT:

Just bought these (will be going through expenses as backup media)



SEXY arent they

[Cowboy Bob]

It depends on what the receipt says, I have a mate who regularly buys games from PC world as it only says 'software'.

I bought a few wireless to wired network bridges and on the receipt it says "Wireless Games Adaptor". Still put them through my books, though had a little note attached so the accountant knew what they really were.

[Bluebird]

The best thing to do is have a business credit card and then use this - makes it look more likr it's for the business rather than reclaiming a 'personal' expense.


I also agree - what the reciept says and sometimes where you bought it from can make it look less dodgy...

I've just bought a camcorder to 'record' workshops to same me taking notes !

[mrdavies]

my friend expensed his PSP as he was doing security research on it too, got some wifi tools on it as a pentest platform

I will be using it as a backup as there is no way I need 80Gb of choons at any one time, leave the decision to expense or not till later i think.

[ratewhore]

Putting a 42" plasma through the company and claiming its to connect your work laptop to is clearly dodgy... But, what about putting an 80Gb ipod through as an external hard drive backup device? Whilst technically true, I suppose its still pushing it a little.

Thoughts?


(yes I've just bought myself a new one)

You've got to be able to justify it, that's all. If you use the ipod for data storage (and lets face it, you can) then claim for it. I have an ipod through the business as I have used it to do business-related research (pod-slurping). I also have a media player through the business as I have been researching the security of home AV equipment and the pen-testing thereof...

HTH

[mrdavies]

Not suggesting I do anything dodgy here I am just learning the process around accounts and expenses , so if I were to put the ipod down in my books as an external hard drive backup device, the receipt would only ever be seen should tax man want to investigate me and see receipts is that correct? People don't send reciepts in each year do they to their accountants? That can't happen surely you keep them on file for 7 years or whatever the retention period is...?

[gingerjedi]

It depends on what the receipt says, I have a mate who regularly buys games from PC world as it only says 'software'.

[mrdavies]

Putting a 42" plasma through the company and claiming its to connect your work laptop to is clearly dodgy... But, what about putting an 80Gb ipod through as an external hard drive backup device? Whilst technically true, I suppose its still pushing it a little.

Thoughts?


(yes I've just bought myself a new one)