Can I claim Capital Allowances on a website?

Mini Driver

Hi Guys,

Does anyone know if a company's website qualifies for Capital Allowances and therefore a corporation tax write-off? The company sells online as its principle source of income

Any help is appreciated

Thanks

maddogcollins

If the website was designed and developed internally then it will qualify as an intangible asset. This will hit the balance sheet. (http://www.iasplus.com/interps/sic032.htm )

You must be able to measure the cost accurately and prove that income will be generated from it in the future.

You came claim tax relief on this then via depreciation, or capital allowances over a ficed term of 15 years. ( http://www.taxireland.ie/documents/general/Intangible_assets_brief.pdf )

The above is open to correction, and I would check with your accountant to be sure as he will have a better knowledge.

swanvill

You should consider if you want to create an asset or write it off as an expenditure (thus 100% against tax instead of writing off over 7 years as capital allowances).

Some questions to answer is how much was the expenditure? ie small amounts easier to argue as expenditure rather than capital?
Is it complete new website or modification/repair?
How long will the website last before the next change.

Either way you should call your accountant once you have answered the above questions.