I understand that a website where I sell goods is treated as a shop window by HMRC and therefore the cost of constructing it is treated as an asset and the cost of ongoing maintenance / updating is treated as a business cost.
However… I use wix and created (and will maintain) the website myself for a yearly subscription fee for their service. Any ideas how this should be split? I spent £150 on a three year sub (£50 a year). I’m looking for any guidance on how this amount should be split between web site build (asset cost) and web site maintenance (expense cost). Any rules of thumb?
Additionally, could I just put the whole £150 subscription cost under software licensing and treat it as a business cost? Even though it’s related to a potential asset (the website)?
I would say it is a kind of subscription, so I would post it to subscription.
I wrote a little guide on website and accounting treatments (end of page), hope that would help.
Thank you both @rhc & @FaradayKeynes I think subscription cost is the best route.
@FaradayKeynes - Your article raised another question for me that I hadn’t considered. Should the cost of buying the website URL be treated as an asset rather than a business cost? I’m guessing it should and should therefore be depreciated. However, the URL provides value every year and doesn’t reduce in value.
Anything below £1000 you can post as P&L item and not necessary to take it to BS.
You don’t depreciate a website URL asset.
Further unless that URL and its website generates revenue I wouldn’t even consider it an asset. Expense it to the p and l
Thanks all. Much clearer for me now.
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