I was reading this post that was talking about the difference between Assets and Expenses.
Definition of an asset: (from Cojak)
an item of property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.
It got me thinking. I have spare cash in the company, and I would like to buy some assets that I can get the use of, that may/ may not appreciate in future. In particular, I would like to buy a grand piano (it costs more than a grand by the way.. ). When I sell the piano in future, if I make a small loss it will still be cheaper than the cost of renting an instrument (especially taking into account the tax relief on the asset purchase, and being able to run any service, storage or transportation costs through the business).
On the surface this sounds silly- an IT services company buying musical instruments. But I understand that service companies can already buy assets like works of art, stamp collections, or vintage wine (and you could argue these are equally silly).
So what restrictions are there (if any) on purchasing physical asset classes through a company, where the company sales are generated in business activities completely unrelated to the asset class?
Cheers,
Lecyclist
Definition of an asset: (from Cojak)
an item of property owned by a person or company, regarded as having value and available to meet debts, commitments, or legacies.
It got me thinking. I have spare cash in the company, and I would like to buy some assets that I can get the use of, that may/ may not appreciate in future. In particular, I would like to buy a grand piano (it costs more than a grand by the way.. ). When I sell the piano in future, if I make a small loss it will still be cheaper than the cost of renting an instrument (especially taking into account the tax relief on the asset purchase, and being able to run any service, storage or transportation costs through the business).
On the surface this sounds silly- an IT services company buying musical instruments. But I understand that service companies can already buy assets like works of art, stamp collections, or vintage wine (and you could argue these are equally silly).
So what restrictions are there (if any) on purchasing physical asset classes through a company, where the company sales are generated in business activities completely unrelated to the asset class?
Cheers,
Lecyclist
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