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Where Taxpayers and Advisers Meet

Self employed - use of capital allowances

Posts: 3
Joined: Thu Dec 06, 2018 11:13 am

Self employed - use of capital allowances

Postby mhuk01 » Thu Dec 06, 2018 11:19 am


I am a self employed musician and usually claim all the expenses I possibly can. However, as I will be applying for a mortgage soon, I am keen to ensure my earnings after expenses are still high enough to please the lender.

For tax year 17-18 I made a significant purchase of equipment for around £3,000. Usually I would claim the full amount, however this will bring my earnings down significantly. Therefore is it possible to claim this expense as a capital allowance, and if so can somebody explain the process? I've heard it's a way of claiming the expense over several years. I have other standard expenses (such as fuel costs), can I still claim those in the normal way too?

Many thanks for your help,


Posts: 3090
Joined: Sat Feb 01, 2014 3:26 pm

Re: Self employed - use of capital allowances

Postby bd6759 » Thu Dec 06, 2018 11:54 pm

If you are using the cash basis: that is accounting for income when it is received and expenses when they are paid, you cannot claim capital allowances.

If you are using conventional accounting, then expenditure on equipment is not an allowable expense and should not be in your accounts at all.... but you can claim capital allowances. You can claim either AIA (which is a 100% allowance), or normal PMA at 18% per year.

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