Reply to: Claiming a laptop as an expense

[Wanderer]

Thanks for help. Bit mixed those replies though. Has anyone who has done this before got a definite answer?

As others have said, it's a fairly standard thing to claim. Read EIM21613.htm. In particular, consider if the example of the "Utility Engineer" applies to you.


Remember that you don't get the full cost back, it's just a deduction against your taxable profits so think of it as being a 20% discount (or more if it's over £2k you can reclaim the VAT too) rather than being "free" or paid for by the tax man...

[BjornMorg]

Hmmm

[tractor]

...

Most Many do...

Yes, but my conscience is clear even though they ignore my pleas to do it properly as I send each invoice

[cojak]

And if you're on FRS, provided that the invoice is over £2k, you can claim VAT on the purchase as well. (Which is why I have a lovely MBP with Enterprise Architect on it...)

(with added Crossover, in case anyone was wondering how...)

[cojak]

You use EA? My multi billion client is still making it up as they go along

Most Many do...

[tractor]

..

Most here have. I have.

And if you're on FRS, provided that the invoice is over £2k, you can claim VAT on the purchase as well. (Which is why I have a lovely MBP with Enterprise Architect on it...)

We can't really make it clearer than that.

You use EA? My multi billion client is still making it up as they go along

[cojak]

Thanks for help. Bit mixed those replies though. Has anyone who has done this before got a definite answer?

See Annual Investment Allowance here.

You used to have to apply depreciation annually and write the residual value of the asset back into profits for subsequent years over the useful life but now it's all different since the FA of 2008 I think.

Check with your accountant though, this allowance is available for small businesses with an annual investment in plant and equipment up to £25k which I would think should cover a laptop

Most here have. I have.

And if you're on FRS, provided that the invoice is over £2k, you can claim VAT on the purchase as well. (Which is why I have a lovely MBP with Enterprise Architect on it...)

We can't really make it clearer than that.

[tractor]

..

Your Company pays for the laptop, out of the fees that it has earned / received.

The Company is able to claim the cost of the laptop as a tax deductible expense. (Noone is going to give your Company the money back).

You can use it, with no Benefit in Kind.

This is the same answer that all the posters above have give, but expressed in a different way. If you aren't able to understand this, then apply your mind to some basic accounting principles.

Or just go to the link I provided where you will see the tax man's view and that really, is all that matters!

[Scruff]

Your Company pays for the laptop, out of the fees that it has earned / received.

The Company is able to claim the cost of the laptop as a tax deductible expense. (Noone is going to give your Company the money back).

You can use it, with no Benefit in Kind.

This is the same answer that all the posters above have give, but expressed in a different way. If you aren't able to understand this, then apply your mind to some basic accounting principles.

[arioon123]

Very mixed bag if comments but thanks a lot.

Has anyone who has done this before got a definite answer?

Thanks

[arioon123]

Thanks for help. Bit mixed those replies though. Has anyone who has done this before got a definite answer?

[tractor]

..

See Annual Investment Allowance here.

You used to have to apply depreciation annually and write the residual value of the asset back into profits for subsequent years over the useful life but now it's all different since the FA of 2008 I think.

Check with your accountant though, this allowance is available for small businesses with an annual investment in plant and equipment up to £25k which I would think should cover a laptop

[MarillionFan]

Absolutely normal

WCS.

All accountants are dodgy and this is normal advice.

[mudskipper]

Hi guys,

Quite new to contracting so could do with some help.

I will need a laptop for as throughout my contract I will be learning new technologies and getting involved in various projects. The laptop will be used for work (when travelling as I have been provided with a desktop PC when at the local site), word processing (finances etc.) and also for future contracts (I am an IT consultant and will be asked to provide my own equipment). Obviously there will be some partial personal use.

My accountant has told me that I can put this through fully as a business expense and pay for it out of my companies tax, then when the tax due date comes along, provide a receipt and it will be deducted from tax owed. Is this correct? I thought that this sounded a tad "dodgy" so I have come here to ask your advice!

Thanks for your help.

arioon123

Not quite. You don't pay for it out of tax, you pay for it before tax - the cost of the laptop isn't part of the company's profit. So if your laptop costs your company £500, that's £100 less corporation tax you pay.

[cojak]

Absolutely normal