I bought 2 pc monitors on company £150 each, but I don’t want to record them as assets for company because I don’t want to deal with deprecation and all stuff related to assets and this are low value items anyway.
So I just want to record them as expenses, which nominal account for it to use?
I’m no accountant, but at a guess I’d say that because they are £150 each they would be classified as assets.
Depreciation isn’t a hassle if you set up recurring journals.
But I’ve read that it is up to the director and accountant to decide the value after which the purchase becomes an asset.
Here is some explanation:
Is there a lower cost limit for when an item becomes a capital asset?
HM Revenue haven’t set one. If you have an accountant, he/she might have a set limit.
But usually it’ll depend on your business’s size. For example, a £25 phone would almost always go into Internet and Telephone as a day-to-day running cost. A £250 phone system would be a capital item for a small business, but probably a day-to-day running cost for a larger
I just don’t want to capitalize this 2 purchases really.
Especially bearing in mind that these are items that can quickly become faulty and that AIA is £100k.
We have a 170k turnover.
Also if for example I buy a computer mouse for £15 will it still be fixed asset?
As I said, I’m no accountant. May be best to check with yours in all honesty, see what they say.
Not material enough to be capitalised
Yeah that’s what I though, but which nominal account to use for this purchases?
Office cost or IT Services
Thanks that’s what I thought.