Can I claim cost of new phone as a tax write off?

[andymc]

I'm in the UK, and I think I'm right to say that if I buy a new phone to test my B4A games on, that I can claim this back on tax? Basically making it 40% cheaper? (As I normally put aside that much for tax).

Does anyone do this? I've done it before with PC upgrades but never really checked if it was totally legit, but I think it is?

Andy

 

[agraham]

When I was self-employed I did just this for various items like PCs and printers. However you can't write it all off in a year as a phone probably counts as capital expenditure and not a consumable, and needs to be properly depreciated. You would probably also need to be declaring income from your games to show it was a business and not a personal expense. It used to cost me about £300 to get an accountant to do my tax return every year and it was well worth it as he always seemed to able to declare a loss. Using an accredited accountant makes dealing with HMRC easier as they trust them (rightly or wrongly) to have some reasonable business ethics and be telling them the truth.

If you are going down that road you can claim use of a room, electricity and some other stuff that your accountant can come up with. However if it is not a serious business you are probably better staying under the radar and not trying to play the system.

 

[rabbitBUSH]

can claim this back on tax?

Not from the UK but what @agraham says is pretty much how it works here : perhaps your revenue vampires will answer the question. Here its quite cheap (and quick) to register a private company and that gives one a bunch of legitimacy (although the tax rate is different - but a decent (real) accountant - as in #2 can help with deductions etc.). This would mean that you can claim travel or a portion of travel and other expenses against business use of items / cars / buses / etc - keep the chits / tickets etc. though. So these should be additional things to those mentioned in #2. Obviously, if you have a company - buy a phone through that account - that account manages a rebate from the revenue vampires - ergo the phone is effectively "free" - other than actually having to have a bank balance. Consult your friendly independent accountant (generally cousins, brothers, aunties, uncles and grandmas are usually not a good idea.)

you are probably better staying under the radar

gee not sure you should say that out loud. . . . .

?

 

[emexes]

In Australia it used to be instant write-off for business assets under $300, then they raised it to $30,000, and now it's $150,000 until the end of the year.

Albeit must be under $500M annual turnover... so if we ever strike a hit app goldmine, we could be in trouble.

Claiming second (and third and fourth...) mobile phones as a business expense for test equipment should be no problem in any country. Your main day-to-day phone might be trickier; I've yet to be challenged about claiming the entire cost and, happily, our politicians and bureaucrats have provided mountains of examples supporting my interpretation of the rules. ?

If that argument doesn't fly, then my backup argument is to cost out the personal-use component as being (cost of phone being used for business and personal use) minus (cost of phone being used for business use only) which, in these days of unlimited plans, is $0. This reasoning also works for internet service. Home phone is a little tricker, but I have a VOIP service at $4/month including DID and free landline calls within Australia (that I do on the mobile anyway) so I don't even bother trying to claim that.

 

[Beja]

I'm in the UK, and I think I'm right to say that if I buy a new phone to test my B4A games on, that I can claim this back on tax? Basically making it 40% cheaper? (As I normally put aside that much for tax).

Does anyone do this? I've done it before with PC upgrades but never really checked if it was totally legit, but I think it is?

Andy

Almost all colonies' laws came from the British Law. I have a certificate in cost accounting from ULCI (Union of Lancashire and Cheshire Institutes) and found
the law is almost the same as here.
As Andrew said, write off the depreciation as business expenses (cost / expected use life in years), repairs, buttery change, cables, new chargers, replacement of screen protectors, even cost of smoothing of scratches by professionals . All these are considered expenses and not capital expenditure and are deductibles.

Cheers!

 

[sorex]

you can also play it smart via another method.

I (living in Belgium) usually order computer related things in Holland.

As B2B sales between EU countries are tax free you don't have to pay the tax at all.

Still better than paying it in/up front and deduct it later.

I don't know it this applies to the UK aswell tho as you folks were always a special case

 

[agraham]

As B2B sales between EU countries are tax free you don't have to pay the tax at all.

Really! I thought that you had to pay the input VAT at the rate of the country of purchase, charge output VAT on your sales and send the difference of your total input and output VAT to the tax authorities - or claim it back if negative.

 

[sorex]

no, in most cases from the moment you enter your VAT number you get the price without VAT and it's not added when completing the order.

for example ordering at CoolBlue is ideal for this. prices in Holland are usually cheaper, and they have 19%VAT instead of 21% but that gets dropped anyway.
even when they have stores in Belgium their financial hq is based in Holland so we can take benefit of that.

this is also the case for B4X licenses if I recall right as the payment processing company is probably located in europe.

 

[Erel]

this is also the case for B4X licenses if I recall right as the payment processing company is probably located in europe.

It is actually a US company (FastSpring). If I remember correctly the company location doesn't matter, regarding the EU VAT. [rant]This is a real pain and is impossible for small merchants to handle. This is one of the main reasons I sold through FastSpring, which leads to unjustified commission loss/[/rant]