- Anything wholly for the business is usually straightforward
- Mixed use, like a van or a phone, is claimable in proportion
- The proportion has to be defensible, which means recorded at the time
- If you would struggle to explain it to a stranger, ask first
Example conversation with Tax & Bookkeeping
You
Can I claim my phone if I use it for work and personal?
Tax & Bookkeeping
Yes, in proportion.
Work out roughly what share of use is business. For most trades that lands between 60 and 80 percent. Claim that share of the bill and the handset.
What matters is the record, not the receipt. Write down how you arrived at the percentage, once, and keep it. If it is ever queried, a note made at the time is worth far more than a reconstruction two years later.
If the contract is in the company name and the phone is genuinely business only, it is treated differently again. Which is it?
Work out roughly what share of use is business. For most trades that lands between 60 and 80 percent. Claim that share of the bill and the handset.
What matters is the record, not the receipt. Write down how you arrived at the percentage, once, and keep it. If it is ever queried, a note made at the time is worth far more than a reconstruction two years later.
If the contract is in the company name and the phone is genuinely business only, it is treated differently again. Which is it?
Express engine. A direct question with a direct answer does not need Advanced.
Paste this to MARCUS
I bought [what] for [amount] and use it about [percentage] for work. How is that treated, and what records do I need to keep to prove it?
Try it on your business
Every lesson ends with a question to hand to a Greymill specialist, who answers with what it knows about your business.
More in Cash, tax and getting paid
- Where the money actually goesBusy, profitable on paper, and the account never grows.Read the lesson
- When a customer will not payThere is an order to this, and skipping to the end costs you money.Read the lesson
- When a customer will not payThere is an order to this, and skipping to the end costs you money.Read the lesson
- Knowing what is due and whenFederal, state and quarterly. Nothing here is difficult, but the surprise is expensive.Read the lesson
- Knowing what is due and whenNothing about tax is difficult. It is the surprise that hurts.Read the lesson
- When the books are months behindEveryone gets here. The way out is not to do it all in one weekend.Read the lesson