Buying SCAN computer for business - can I claim it as an expense?

[ZoeH]

Hi! I need an upgrade for my office PC. I was wondering if I will be able to claim a SCAN system as a business expense if I was to order from you? My current PC can't keep up with my workload, and while I'd much rather build the PC myself I don't have the time, so will be trusting SCAN with building it

I'm currently on 28000 a year so will be paying 20% tax. 20% of a thousand or so isn't an insignificant amount! Could definitely be put towards upgrades

Thanks for any replies!

[ik9000]

Sounds like one for your company accountant. NB your business may still have to pay tax, it's just done in a different way for businesses. There are different ways of dealing with this, some let you purchase without charging the VAT. Other times you have to get a VAT invoice and reclaim, or rather offset the paid VAT against the various business corporation taxes and the like. I'm not an accountant but I do know the taxman tends to win, and I doubt you will get that full 20% to spend on "upgrades" by the end of it all. NB also the business will then own the machine, and it will become a company asset, and need to be logged in the accounts until its depreciation drawdown has been completed. So you won't be free to sell it, and if the business folds you don't (necessarily) get to keep it. Tax is not straightforward, and I strongly suggest going through this with your accountant. That would seem a more reliable way of being confident you're not inadvertently breaking any laws.

Edit: I assume, given your mention of salary, that you are hoping to list this in a tax return as a business expense - in which case you are presumably self-employed and compiling self-assessment forms? SFAIK you can deduct legitimate business expenses from earnings, and hence attempt to offset its cost against your income and attempt to reduce your income tax this way, but you really really need accountants to advise you here. If you're not doing tax returns and on a fixed salary from a PAYE system it gets much much more tricky. That is way outside of my skill set. Like I say, ask your accountant.

[peterb]

If you are registered for VAT you can claim back the VAT. If you are operating a limited company, you may be able to offset the cost against corporation tax as a capital allowance. If you are a sole trader you probably can, but you need to show it in yur accounts, and if it is a higher spec than you might expect from an office computer, you may need to justify that to HMRC. You should also order it through a company account to a business address.

But I am not an accountant - for proper professional advice, that is where you should be seeking advice.

[g8ina]

And guessing which way this thread might go, Scan are unlikely to sell VAT free, you will have to buy at full price and claim back later. The only VAT free sale would be for a visiting overseas resident, and even then, it is not simple.

[Phage]

At that size you should be on the Flat VAT rate. Talk to a public accountant. If you're a sole trader or contractor I can recommend that you use a service provider like this one

http://www.firstfreelance.com/

Their fees are also tax deductible