Dell 3year protection on purchase Laptops- Is it a capital or P&L Expenditure

[css_jay99]

I am planing on buying a Laptop from dell with 3year on-site protection. I dont think dell does 2 sepearte invoices

In My accounting, can I split the cost of the laptop into capital expenditure and P&L expense for the protection part of the purchase or It has to hit the books in whole as a capital expense


Cheers

css_jay99

[zedAccounts]

>can I split the cost of the laptop into capital expenditure and P&L expense for the protection part of the purchase

That's what I would do.

ZED.

[HairyArsedBloke]

Split it - most definitely.

[Scrag Meister]

Doh!!

Pretty sure mine went through as one entity in the accounts when I got mine in Nov 2007, and is therefore all being written off over 4 years I think.

Oh well, live and learn.

[Stag Cozier]

You'll get the full tax relief on the whole lot if you capitalise it in year anyway.

For correctness, it should be split. If you do split it, your accountant should spread the cost of your 3 year protection over 3 years (prepayments) in the accounts.

[Clare@InTouch]

Doh!!

Pretty sure mine went through as one entity in the accounts when I got mine in Nov 2007, and is therefore all being written off over 4 years I think.

Oh well, live and learn.

For tax purposes it probably doesn't matter. The laptop and any associated costs would have been written off under capital allowances in the first year anyway, regardless of how fast the asset is written off in the accounts.

[css_jay99]

For tax purposes it probably doesn't matter. The laptop and any associated costs would have been written off under capital allowances in the first year anyway, regardless of how fast the asset is written off in the accounts.

Hold a sec. Am I missing something?
How can you get a first year allowance of 100% ?

See below from hmrc
First-Year Allowances
In certain circumstances, you can also claim First-Year Allowances of 100 per cent in the year your company or organisation makes the purchase of certain plant or machinery. This means you can deduct the whole purchase cost of the asset from your company or organisation’s trading profit in the accounting period when it was purchased. Examples of expenditure that may qualify for 100 per cent

First-Year Allowances include:

low carbon dioxide emission cars
energy-saving plant and machinery
environmentally beneficial plant and machinery
equipment for refuelling vehicles with natural gas, biogas or hydrogen fuel
North Sea oil ring-fence plant and machinery and mineral extraction.
In addition to the 100 per cent First-Year Allowances, there is a new temporary 40 per cent First-year Allowance for expenditure on most plant or machinery (other than cars) incurred in the year 2009-2010, that is, between 1 April 2009 and 31 March 2010, in the case of companies.




css_jay99

[Clare@InTouch]

It's possible to write off the value of an asset pool under £1,000 - so even if an asset is still in the accounts it should have been written off fully for CT purposes.

[css_jay99]

futher diging show on hmrc show that i can still do a 100% FYA , doh!.

So This means that :-
1) I can claim 100% FYA on computer and mobile phone ?
2) Depreciation of for 4 year straight line method for computer


css_jay99

[Clare@InTouch]

futher diging show on hmrc show that i can still do a 100% FYA , doh!.

So This means that :-
1) I can claim 100% FYA on computer and mobile phone ?
2) Depreciation of for 4 year straight line method for computer


css_jay99

There's now an Annual Investment Allowance of £100k - meaning you can write off assets up to that value 100% in the first year. How you choose to depreciate it in the accounts doesn't really matter from a tax viewpoint.

Don't forget you can have a mobile phone and a blackberry with no BIK implications.