how to account for purchases over£200.00

[watgem]

sorry if this has been asked before but how do we account for purchases over £200.00 please? I seem to remember when I first registered the tax lady saying something about more expensive items being worked out differently?but unfortunately have lost the info, any advice very welcomexxx

[zippy]

Anyone over 200-300 is classed as a capital purchase and so needs to be declared using the capital allowances procedure for the particular year we are in, the allowance sometimes changes from year to year, the first year is known as first year allowance or fya, you'll need to google for this years allowances. You take off say 50% this year then the rest is called over as a balance to next year where you may be able to claim say 25% of remaining balance and so on. Hope that makes sence.

[watgem]

thank you:):)

[MrAnchovy]

It is Annual Investment Allowance you want, First Year Allowance is something else. You can claim the whole amount of up to £25,000 of equipment cost (but not buildings of any kind) in the year you purchase it.

[zippy]

Oh, didn't realise sorry, so of I buy a buggy for 400 or a playhouse for a thousand I can claim the lot, is that right?

Is there a special box I need to put it in on tax return or just in normal bit?

Is this also the same for computers/iPads?

Is this allowance always 100% or does it change from year to year?

Sorry for all the questions.

[MrAnchovy]

Q. Oh, didn't realise sorry, so of I buy a buggy for 400 or a playhouse for a thousand I can claim the lot, is that right?
A. That's right. But if this reduces your profit so much you end up paying no tax you might be better off doing it a different way.

Q. Is there a special box I need to put it in on tax return or just in normal bit?
A. Yes, it goes in the box "Annual Investment Allowance" under "Tax allowances for vehicles and equipment (capital allowances)"

Q. Is this also the same for computers/iPads?
A. Yes, anything except buildings (which you can't claim for at all) and cars (which have special rules). In the guidance for childminders HMRC use a play house costing £400.

Q. Is this allowance always 100% or does it change from year to year?
A. Annual Investment Allowance was introduced in April 2008 and has always been 100%. There was some talk of it being removed this year, but instead the total amount you can claim was reduced from £100,000 to £25,000. If you don't claim Annual Investment Allowance you can claim Writing Down Allowance instead. Since its introduction in 1978 this was always 25% but in 2008 the main rate was reduced to 20% and a new 10% rate was introduced for some assets (particularly cars) and the rates were reduced again to 18% (with the reduced rate at 8%) from April 2012.

Sorry for all the questions.
No problem :)

[zippy]

Thankyou very much for your time on this, you may just have convinced me to treat us all to an iPad heheheh