iPhone4 to 4S upgrade

[ruth11]

Personal use can heavily outweigh company use and still have no BIK to pay (linky). See example 2 for a good example.

Brilliant. Thanks for this, very useful indeed. Now bookmarked in case of future need.

[craig1]

That's correct, HMRC treat iPhones and Blackberries as computers so different rules apply. The rules for computers can be found on the HMRC website:

HM Revenue & Customs: Computers loaned to an employee

Provided personal use isn't significant there will be no BIK to pay.

Martin

Personal use can heavily outweigh company use and still have no BIK to pay (linky). See example 2 for a good example.

[Martin at NixonWilliams]

What about this page at HMRC

It explicitly states "Please note that the rules in this guide don’t apply to a device such as an iPhone or BlackBerry – the range of functions these devices offer means that HM Revenue & Customs (HMRC) doesn’t consider them to be primarily mobile phones. For details of the rules that apply, see the A to Z entry ‘Assets made available to an employee’.

So would you have to pay the BIK if buying an iphone through the ltdco?

That's correct, HMRC treat iPhones and Blackberries as computers so different rules apply. The rules for computers can be found on the HMRC website:

HM Revenue & Customs: Computers loaned to an employee

Provided personal use isn't significant there will be no BIK to pay.

Martin

[Clare@InTouch]

The question I always ask myself is, "Would my MP expense this?" So obviously everything is allowable, and if not a simple apology and paying back just the tax would be sufficient.

Btw Clare, personal assets can be transferred to the business at a reasonable cost. I did that with a server I owned that was hosted in a data centre.

I absolutely agree. What I meant was that if he's currently using a phone he paid for personally and then he sells it, there's no company tax implications because it's a personal asset that was never transferred into the business in the first place. Therefore it's not a consideration.

[northernladuk]

The question I always ask myself is, "Would my MP expense this?" So obviously everything is allowable, and if not a simple apology and paying back just the tax would be sufficient.

Btw Claire, personal assets can be transferred to the business at a reasonable cost. I did that with a server I owned that was hosted in a data centre.

Obviously, that is why a couple of them went to gaol.. Fill your boots...

[Wanderer]

The question I always ask myself is, "Would my MP expense this?" So obviously everything is allowable, and if not a simple apology and paying back just the tax would be sufficient.

It would be nice if that was true.

I was moaning about MP's expenses being unreasonable and excessive to a friend the other day and he countered with the question "Well, how do you define what is reasonable then?"

Simple, I said. There are hundreds of pages of definitions of what are reasonable business expenses published by HMRC and all MPs should simply abide by these rules. Why have one rule for their allowable expenses and another for everyone else?

Sadly, I don't think I will be expensing a duck house any time soon...

[Wanderer]

Ok so we see that a business can supply a NON-smart phone to an employee for business and personal use and there is no BIK implication as long as the contract is in the company's name.

So would you have to pay the BIK if buying an iphone through the ltdco?

Smart phones are different (iPhone and Blackberry are specifically named but presumably Android too) and this exemption doesn't apply. Rather, it comes under the rules for Business assets made available to an employee.

If it's for business use only then there is no tax to pay. If there is an element of private use then you calculate the apportionment of private vs business use, your accountant would calculate the benefit to the employee and the tax on the BIK.

I'm sure most companies have business assets which fall into this category. I would suggest that you deal with it in the same way as you would deal with (say) a laptop computer purchased for business use....

[Mr.Whippy]

What about this page at HMRC

It explicitly states "Please note that the rules in this guide don’t apply to a device such as an iPhone or BlackBerry – the range of functions these devices offer means that HM Revenue & Customs (HMRC) doesn’t consider them to be primarily mobile phones. For details of the rules that apply, see the A to Z entry ‘Assets made available to an employee’.

So would you have to pay the BIK if buying an iphone through the ltdco?

[tarbera]

Accountants

The question I always ask myself is, "Would my MP expense this?" So obviously everything is allowable, and if not a simple apology and paying back just the tax would be sufficient.

Btw Claire, personal assets can be transferred to the business at a reasonable cost. I did that with a server I owned that was hosted in a data centre.

Indeed some Accountants are 0% risk adverse to anything !!!! and if you belive some on expenses you can't claim for anything.

[tarbera]

Jeues

Hello all,

Question from me regarding iphone4 to iPhone4S upgrade costs.

What is my stance with this....can I expense the cost of the new handset through my limited company?

Is it an eligible expense? I would say that the "using" of the phone is of course....but I guess I'm asking about the justification of the upgrade cost?

Also, what would I do with the existing iPhone4?? Which I'm sure I bought personally and didn't claim for originally.

Any help would be welcome.

Many thanks, LG

Yes FFS its a business expense

Sell your existing one back to O2 (check there website, £284 refund for an old Iphone4)

I got a quote today £139 for an upgrade + 284 quid back for my old one - no brainer

[escapeUK]

The question I always ask myself is, "Would my MP expense this?" So obviously everything is allowable, and if not a simple apology and paying back just the tax would be sufficient.

Btw Claire, personal assets can be transferred to the business at a reasonable cost. I did that with a server I owned that was hosted in a data centre.

[northernladuk]

At the end of the day most of that money will be coming out of your pocket anyway. The only saving to you is the difference in CT so don't kid yourself you are getting it for free.

I assume your phone contract is in the company name to be claimable as well?

[Clare@InTouch]

If the contract is in the company name then I'd say you're fine to claim for it.

Assuming you bought the existing one personally then it's neither here nor there, it's a personal asset.

[Lloyd1981]

Hello all,

Question from me regarding iphone4 to iPhone4S upgrade costs.

What is my stance with this....can I expense the cost of the new handset through my limited company?

Is it an eligible expense? I would say that the "using" of the phone is of course....but I guess I'm asking about the justification of the upgrade cost?

Also, what would I do with the existing iPhone4?? Which I'm sure I bought personally and didn't claim for originally.

Any help would be welcome.

Many thanks, LG