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Claiming for expenses - Self Employed
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I think, by definition, if your husband was signing on as unemployed at the time, the expenses you refer to were not wholly and exclusively incurred in performing his employment duties. :cool:
As regards to reclaiming costs for machinery, only depreciation can be allowed for. He needs to calculate this based on the date & price he paid for them.
If he's not paid for them, then there is nothing to depreciate!
Perhaps he could lease them from his family member? The owner should notify HMRC accordingly of any income being received.
Depreciation is the reduction in value of a capital asset which is charged to the business profit and loss account over the useful life of the asset.
It is disallowed for tax purposes and is added back to profits before Capital Allowances are deducted. Capital Allowances are the amounts you are allowed to write your capital assets down by for tax purposes. At the moment the Chancellor is trying to encourage capital investment so you are allowed, but do not have to, write down the value of the asset by 100% in the year of purchase up to a max of £250,000.
It sounds to me as if you will have to repay your relatives for the assets they have bought for you, so it is a loan and you should recognise this in your accounts and thus bring in these assets.The only thing that is constant is change.0 -
zygurat789 wrote: »Depreciation is the reduction in value of a capital asset which is charged to the business profit and loss account over the useful life of the asset.
It is disallowed for tax purposes and is added back to profits before Capital Allowances are deducted. Capital Allowances are the amounts you are allowed to write your capital assets down by for tax purposes. ...
Yes, thank you for the correction. I should have said Capital allowance rather than depreciation.
I have now corrected my post.0
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