Self Employed - Buying a laptop

Noneforit999

Hi
So I have a full time job but do a little private work. I work in IT so a laptop is needed for my job. I currently have an old personal one i am using but I would like a new one for the private work with a longer battery and better specs.

Being self employed and only earning 5-6k privately I have never claimed expenses, I just put the profit as 40% of the 5k to 6k depending on the year.

I have read you can claim a laptop purchse but it's percentage based, how would they prove how much you used it for personal use? If you had a cheaper second laptop for personal use but picked up the work one one day to check something. Surely this is impossible to prove?

If I made say 5k in income which would normally mean 2k in tax, could I buy a 2k MacBook and say only 3k in profits for that year?

Cheers

Tom99

Yes you can claim for a laptop. Its up to you to declare how much personal use.
If you go OTT the HMRC may query your claim.

Noneforit999

Interesting.

So if I assumed 60% work and 40% personal was a fair figure, I could deduct £1200 from my pre tax earnings for the year and assuming I earned £5k total, I would then pay tax on £3800 of it?

Thanks

laticsforlife

I'm not convinced you have to show anything of the sort - if you intend to buy the Macbook specifically because of the private work (and you can show you also have a private laptop that does different tasks), then I don't see why you need to pro-rata it at all.

As for claiming it, if I'm reading it right, you can claim it as Annual Investment Allowance, so yes you do get the full £2k off your profits.

NB how did you come up with 40% as profit - I presume that's an example for here, not really how you report your profit to HMRC?

Noneforit999

laticsforlife I meant tax in the OP, not profit. It was a mis type.

I pay 40% tax on my earnings.

Pennywise

laticsforlife wrote: »

I'm not convinced you have to show anything of the sort - if you intend to buy the Macbook specifically because of the private work (and you can show you also have a private laptop that does different tasks), then I don't see why you need to pro-rata it at all.

Intention doesn't matter. What matters is actual use. If the laptop is used for anything more than "trivial" private use, then it has to be pro-rata'd.

tebthereb

Trivial? Are you thinking about !!!8220;insignificant!!!8221; for BIK purposes? I didn!!!8217;t think CAs benefited from a get out for minor private use.