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#1 08-05-06 19:44:36

New Girl
Verified Member
From: Somerset
Registered: 25-07-05
Posts: 524

Internet as an expense

As I have broadband at home, can I out down for the whole amount per month in my expenses?

Is it more complicated than that because our Broadband package also includes our telephone calls?

Hopefully this will be my last tax related question.....but I can't promise anything!!!

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08-05-06 19:44:36

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Re: Internet as an expense




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#2 08-05-06 21:24:19

adi
Verified Member
From: shropshire
Registered: 28-02-04
Posts: 1,231
Website

Re: Internet as an expense

If you are running and maintaining a website for your business then yes, you need broadband coonection to maintain the site so it is an expense.

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#3 08-05-06 23:06:12

Karenadi
Guest

Re: Internet as an expense

mine goes as business expense along with 1/3 of phone bill.

#4 09-05-06 06:28:07

New Girl
Verified Member
From: Somerset
Registered: 25-07-05
Posts: 524

Re: Internet as an expense

Well I dont run a webite (yet) but do use on-line booking with the DSA, come on this site for advice, buy books etc on-line and do a lot of things to do with being a driving insructor.

I do also use it for private use though......so what do you think?

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#5 09-05-06 07:30:30

Morgan
Verified Member
Registered: 10-06-05
Posts: 202

Re: Internet as an expense

Hi

Been asking a lot of these same questions to my local tax office (who I must say are really helpful)

Worst case you should be able to claim a portion. If your ISP gives you access to usage logs (or you know how to get them off your own PC)  Get a few months as sample then use them to calculate a reasonable private/business split. 

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#6 09-05-06 10:59:23

Colin Martin
Verified Member
From: Southsea
Registered: 21-01-05
Posts: 2,465
Website

Re: Internet as an expense

Claim for it all, if the tax office disagree then negotiate a percentage. I presume you have one of the combined phone call internet packages where phone and broadband are not seperated on the bill. If they are seperated charge all of the broadband and negotiate an amout for phones.

It could always be argued that you would not even have a computer if you were not self employed so all computing expense should be claimed.


Colin Martin
The Bright Red L http://thebrightredl.com
Instructor Apps http://drivinginstructorapps.co.uk
Apps Video channel https://www.youtube.com/colinbythesea

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#7 09-05-06 11:57:57

Morgan
Verified Member
Registered: 10-06-05
Posts: 202

Re: Internet as an expense

"It could always be argued that you would not even have a computer if you were not self employed so all computing expense should be claimed."


Would they not look at the inception date of your broadband package against the start date of being an instructor, if you tried to argue any decission.

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#8 09-05-06 14:13:04

Colin Martin
Verified Member
From: Southsea
Registered: 21-01-05
Posts: 2,465
Website

Re: Internet as an expense

As with any allowable expense it can end in a negotiation with your tax inspector. However, as a home computer user you can choose to turn off your broadband and throw out your computer. With a business a connected computer is probably considered essential in all circumstances.

Our instructors have a login to the booking system so they could certainly argue a computer is essential.


Colin Martin
The Bright Red L http://thebrightredl.com
Instructor Apps http://drivinginstructorapps.co.uk
Apps Video channel https://www.youtube.com/colinbythesea

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#9 09-05-06 17:18:45

Panjandrumbuilder
Guest

Re: Internet as an expense

I agree - claim for it all and don't forget that if you buy a computer for use in your business, it's a capital purchase, just like a pair of ladders or a van to a builder, so claim your capital allowance against it.  smile

#10 09-05-06 17:57:56

Colin Martin
Verified Member
From: Southsea
Registered: 21-01-05
Posts: 2,465
Website

Re: Internet as an expense

I have just cosulted my good lady Sue, our financial brain, and confirmed that if you claim capital write of against the purchase price you cannot claim for the cost of purchase. So you choose the best one for the situation.


Colin Martin
The Bright Red L http://thebrightredl.com
Instructor Apps http://drivinginstructorapps.co.uk
Apps Video channel https://www.youtube.com/colinbythesea

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#11 10-05-06 08:46:17

Panjandrumbuilder
Guest

Re: Internet as an expense

Quite right Colin. However, the question arises as to whether the purchase of a computer is a capital item, or a revenue item. Circumstances of use might apply to different types of business to determine if an item is either a capital or revenue asset. The test I use is, if an item is capable of being consumed in a business, e.g., fuel, printer cartridges, paper, etc., then it's a revenue item. If it's an asset which isn't ostensibly consumed, but is used in the business and its ownership and/or use reflects a reducing asset value, then it's a capital item.

You might disagree. 200 years of case law haven't managed to accurately define what has become known as the capital/revenue divide, so "you pays your money and takes your chance!" 

#12 10-05-06 11:58:04

susanbythesea
Guest

Re: Internet as an expense

Hi,
just thought l'd give what l use as a definition of a capital purchase....at the end of an items use will it be sold again?...a car generally will be sold on after driving school use and the price received will be compared to the price it is valued in your annual accounts,if their is a difference then that will be offset against your tax for that tax year,with computers as panjan states their is a question whether they are a capital purchase or a consumable,apply the previous rule whereas what will happen when you have finished with its business use,will it be sold? we have 3 computers we use, 2 are consumables 1 is a capital item.

hope this helps
Sue

#13 10-05-06 12:01:50

luchell
Guest

Re: Internet as an expense

Oh crikey im lost in all this capital stuff!! All i know is i gave my book keeper my receipts for our home pc and the laptop as i take it in the car when necessary for Hpt and theory practise. He said claim both. I hadnt thought of our Broad band package although will include that bill i think. Only thing is it comes of the mastercard so ill need to find all those statements  roll

#14 10-05-06 12:43:09

Panjandrumbuilder
Guest

Re: Internet as an expense

Since my earlier post I've checked on the IR web site and computers, which are included under the heading ICT are all capital items. There was a situation up to 31st March 2004 where computers attracted a 100% first year allowance. As such, you might say that such an asset could be treated in the same way as a revenue item. But, that finished in 2004 and since then, normal FYA rate has applied with 25% pa being allowed in the second or subsequent years.

Sue mentioned how to deal with capital items which are subsequently sold. The rule is that if you make a profit or a loss on the sale of the item in relation to its then written down value, you attract a balancing charge or a balancing allowance respectively. This difference is then either deducted from or added to that year's pool of capital allowances.

As it happens, I'm just in the process of producing a tool to calculate the capital allowance on cars costing less than £12,000.00 new. You can also use it on other capital assets under that value.  yikes

#15 19-05-06 17:35:32

New Girl
Verified Member
From: Somerset
Registered: 25-07-05
Posts: 524

Re: Internet as an expense

Right - Just trying to add my broadband bill in to my accounts and I'm not sure how much to put down.

I'm with Homecall who provide a package which includes your phone bill and broadband bill.

I wasn't planning on claiming any land-line telephone calls as I am going to claim my mobile calls.

The Homecall bill is set out like this...

Homecall Anytime (telephone)   £12.50
Homecall Broadband                 £24.99
Homecall Broadband discount     £7.50

So how much should I put in my accounts for my broadband? I'm thinking 17.49, but not really sure :-

Any help appreciated  smile

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#16 20-05-06 12:34:32

Panjandrumbuilder
Guest

Re: Internet as an expense

The £17.49 looks right, but if the Homecall telephone (Anytime) is part of the infrastructure, i.e., a package, then I'd include that too.  smile

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