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Accounting Treatments

crispycrispy Trusted RegularSouthamptonRegistered Posts: 456

I wonder if anyone can help me with advice on the correct accounting treatment of the following items (based on a real life small ltd company - Turnover £2m)

1.Expenditure of £4k for windows office 2007 licences & software
2. £850 costs on company website
3. Payment received from HMRC due to an overpayment of Employers NI for a previous year.

Any feedback would be appreciated. Thanks :001_smile:


  • peugeotpeugeot Experienced Mentor Registered Posts: 624
    Hi Crispy,

    The £4k windows & software should be capitalised under intangible fixed assets and amortised accordingly.

    £850 website costs: this is a grey one. UITF 29 states that you can only capitalise website costs where the website will generate business and this business can be separately identifiable e.g. if the website has an ordering facility - planning costs associated with the website should be expensed. To capitalise you need to look at the relationship between the expenditure and the future revenue it will generate (if any). Consult UITF 29 for further info.

    Refund from HMRC = debit bank, credit employers NIC or staff costs in the profit and loss.

    Kind regards
  • crispycrispy Trusted Regular SouthamptonRegistered Posts: 456

    Many thanks for your reply, just the info I was looking for.

    Cheers :thumbup1:
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