Buying a laptop as a work expense

uknick

RNeutron wrote: »

@Pennywise, does that apply also if the purchase was through personal finance. For example I bought a PC from a seller that provided finance through a third party lender. In that case, do I only claim what I paid toward that finance during the year or would I claim the whole purchase amount?

Do you do your accounts on a cash basis? If cash, as the link says, you deduct the actual cash payments in the year. Look at example 3 in the link.

If accrual basis the full amount is deducted in year of purchase.

01afraser4

I'm not totally sure on this, but wouldn't a Laptop be considered Capital expenditure, and therefore Capital Allowances should be claimed rather than a revenue expense?

RNeutron

You can’t claim capital allowance when using the Cash basis. It will have to be considered as an expense. The question here is if I purchased that laptop let’s say from Currys PC world through finance (not hire purchase) i.e. they offered me a credit plan through a third party lender such as Hitachi where I would pay in installment to Hitachi would in that case claim only what I paid in the year or can I claim the whole amount.
Note: a personal finance agreement allows you to own the laptop straight away. Now looking at the cash basis rules, it says that only what you pay in the year is claimed. But other people argue that you already own the laptop so you can claim it all and they consider the matter as a cash borrowing loan. In my opinion, you cannot claim the whole amount because the actual money you paid during that year for the purpose of the purchase of this laptop is only the installment you paid to the lender as per the finance agreement. Many people are giving different opinions on this.

RNeutron

uknick
“
@Pennywise, does that apply also if the purchase was through personal finance. For example I bought a PC from a seller that provided finance through a third party lender. In that case, do I only claim what I paid toward that finance during the year or would I claim the whole purchase amount?
Originally posted by RNeutron
”
Do you do your accounts on a cash basis? If cash, as the link says, you deduct the actual cash payments in the year. Look at example 3 in the link.

If accrual basis the full amount is deducted in year of purchas

Example 3 talks about hire purchase in that case tou dont own the laptop until you pay the full amount. In my case the personal finance agreement offered by the seller through a third party lender will give you ownership to the laptop from day 1. I personally don’t think it matters because at the end of the day in both cases you are still paying in installment. I dont know tbh

00ec25

RNeutron wrote: »

I personally don’t think it matters because at the end of the day in both cases you are still paying in installment.

is the correct answer


cash basis = account for instalments actually paid,
not notional borrowed cost

01afraser4

RNeutron wrote: »

You can’t claim capital allowance when using the Cash basis..

Have we established that the OP is using the cash basis and not the accruals basis?

RNeutron

I am not sure about the post originator.