PTC - Annual Investment Allowance - v - Depreciation Expense

anniem

Can anyone help?

If you are claiming Annual Investment Allowance, can you still claim the depreciation expense of the asset you have purchased?

Anna

Bluewednesday

Do you mean depreciation or do you mean writing down allowance?

Assuming you do mean depreciation, that goes into the accounts but is added back in the trading profits calculation where capital allowances are taken off.

So one is claimed in the accounts and one is claimed for tax.

anniem

OK - if you are claiming AIA on a van purchase at 100% of the purchase price (it's under £50,000), are you also able to claim for 25% depreciation in the expenses for the year on the income and expenses side of a Tax Return?

I think you'd be claiming it twice, which can't be right?

Anna

Bluewednesday

You claim the depreciation on the tax return but then you also put it in the disallowed column so it isn't taken into account when you work out the taxable profits

anniem

I understand; Thank you.

AK002

Depreciation is added back on the tax comp so it isn't actually claimed on the tax return.

Bluewednesday

It is on the self employment full pages which is what I presumed the original poster was asking about.

If it is a limited company you need to supply a trading profits adjustment computation which as AK002 has stated will include an add back for the depreciation.

I presumed you meant a self employed person which has a separate column (on the full pages only) for disallowed expenses which is where you would put the depreciation.

anniem

It was related to tax return calculation; but not on a full form, so there isn't a column for disallowables; I think I've decided it shouldn't be included in 'expenses'!

There simply isn't a box on the form to put it in as an expense and then take it out as disallowable!!!

Anna

Bluewednesday

Then you need to not include it as you say and just include the capital allowances.

I take it your just filling in the 2 boxes saying income and expenses?

anniem

Yes, it was a piddly I&E, but a van was purchased!

A x

anniem

PS. I feel like I'm always on this site, but it's my home page (as I'm a distance learner and get lonely), and I've been sorting out my and hubby's tax returns before hip operation on Thursday - because I think I'm going to die if I have an anaesthetic, scared rigid as I've never had an operation before!!!!!!!!! I cant find a 'scared' icon and still missing smilies.

*Jo

anniem wrote: »

PS. I feel like I'm always on this site, but it's my home page (as I'm a distance learner and get lonely), and I've been sorting out my and hubby's tax returns before hip operation on Thursday - because I think I'm going to die if I have an anaesthetic, scared rigid as I've never had an operation before!!!!!!!!! I cant find a 'scared' icon and still missing smilies.

Try not to worry, ive had anaesthetic a few times now. Im sure your be fine. Your wake up and wonder what on earth you were worried about

anniem

Hi Jo

Thanks for the encouragement - I do need to be able to come home - if only to find out how hubby gets on looking after 2 boys (age 11 & 2) alone for 3 days!!! Having 3 days to myself is the luxury bit, very self indulgent (despite being looked at by a room full of theatre staff with no undies on ....... ooooo eeeeerrrrr) :-/

Anna