PTC - Annual Investment Allowance - v - Depreciation Expense

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anniem
anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
Can anyone help?

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

Anna
FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire

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  • Bluewednesday
    Bluewednesday Registered Posts: 1,624 Beyond epic contributor 🧙‍♂️
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    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
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
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    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
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • Bluewednesday
    Bluewednesday Registered Posts: 1,624 Beyond epic contributor 🧙‍♂️
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    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
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
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    I understand; Thank you.
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • AK002
    AK002 Registered Posts: 2,492 Beyond epic contributor 🧙‍♂️
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    Depreciation is added back on the tax comp so it isn't actually claimed on the tax return.
  • Bluewednesday
    Bluewednesday Registered Posts: 1,624 Beyond epic contributor 🧙‍♂️
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    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
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
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    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
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • Bluewednesday
    Bluewednesday Registered Posts: 1,624 Beyond epic contributor 🧙‍♂️
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    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
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
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    Yes, it was a piddly I&E, but a van was purchased!

    A x
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • anniem
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
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    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.
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
  • *Jo
    *Jo Registered Posts: 509 Epic contributor 🐘
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    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
    anniem Registered Posts: 1,326 Beyond epic contributor 🧙‍♂️
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    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
    FMAAT - AAT Licensed Member in Practice - Pewsey, Wiltshire
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