A self-employed odd job man wants to claim on some tools (drill, saw etc) each of £150 to £300 in price and they will only last about two years. I understand that tools fit in plant and machinery as a capital allowance, but do items of such a low value and limited life fit with this?
Some businesses choose to put items below a certain value but which could be interpreted as capital items into a 'small capital' account, annotating each entry to detail the item and putting all of that account to expenses. Others add everything to the register but depreciate small items over 1 or 2 years and clear them that way.
It seems to depend on the business turnover and the materiality of the amount.
For the examples I've seen the items are claimed as expenses where the amount of an individual item is less than 0.5% of turnover - but I don't think there is a hard and fast rule about it.
Thanks for your helpful reply. This is a very small newish business; I think it's the first time he wants to claim on tools as it's the first year he will pay tax.
Just to add to Theresa's point, if the "plant & machinery", in this case hand tools, are not expected to last more than two years, they can be treated as an expenses item for tax purposes.
