Capital Items or Business Expenses?

toby_puppy

Hi

Purchase of Ipads totalling £658 on a partnership set of accounts (mechanic) would this be classed as capital expenditure?

Also, is there a monetary limit, ie. it seems some items aren't worth capitalising such as a compressor for £100, a printer for £75.

What is the general rule when allocating such items in the accounts?

CTA_2

toby_puppy wrote: »

Hi

Purchase of Ipads totalling £658 on a partnership set of accounts (mechanic) would this be classed as capital expenditure?

Also, is there a monetary limit, ie. it seems some items aren't worth capitalising such as a compressor for £100, a printer for £75.

What is the general rule when allocating such items in the accounts?

Do the assets in question have a useful economic life greater than two years? Generally speaking, HMRC will expect relief to be obtained through capital allowances as opposed to a revenue deduction in those circumstance.

There is no monetary limit technically, in practice it would depend on the size of the organisation. Working with smaller companies i have certainly capitalised assets of £75 and £100 and claimed relief via capital allowances. In the modern age it isn't so much of an issue with the AIA being available.

Would I, if i were a HMIT, expect an ipad to have a UEL of more than two years? Yes, i would.