Buying luxuries and unnecessary equipment for business

(Cad drafting 10-12 hours a day clicking buttons all day long tends to kill them )

Thread diversion but I do a lot of screenwork (not like CAD levels of clicking though) and have just gone to an upright mouse so your hand is rotated 90deg compared to a conventional mouse.

It's an insanely better design imo for prolonged use. Seems to stop that bunched up feeling I've always had with a normal mouse.

I think I’m on something like my 14th mouse in 8 years ( pc not the vermin type).
I used to buy £10 cheapies, then decided about 18 months ago to buy a super duper £100 gaming mouse and it’s still going strong. Luxury price for a mere mouse , but I’ve spent more on the cheapies in total .
(Cad drafting 10-12 hours a day clicking buttons all day long tends to kill them )

This is an excellent example.

Well worth it, like a tradesman buying a Makita drill instead of a B&Q own brand. But not the extravagant luxury this debate is about.

Also if you buy a £100k SUV you don’t get an immediate deduction against current year revenue for tax

you can claim the full value against corporation tax in the first year if it’s an EV 😉

Thread diversion but I do a lot of screenwork (not like CAD levels of clicking though) and have just gone to an upright mouse so your hand is rotated 90deg compared to a conventional mouse.

It’s an insanely better design imo for prolonged use. Seems to stop that bunched up feeling I’ve always had with a normal mouse.

I did borrow one to try , but I just couldn’t get on with it (20+ years of muscle memory I guess)

you can claim the full value against corporation tax in the first year if it’s an EV 😉

Yes fair point I'm too late to insert the words "fire breathing petrol" in front of SUV but in my head that's what I was thinking of.

But not the extravagant luxury this debate is about.

does my £4k laptop qualify me for this 😉

does my £4k laptop qualify me for this

Anyone who spends 4k on a laptop should do this with it:

You say extravagant luxury but what makes you think a business might not just be making enough profit?

Like, owner is happy with what they're making and just wants it to be a nice place to work.

I'd say a macbook falls nicely into that category even if I wouldnt have one myself. If it was the owner decking out a £6k gaming rig whilst the staff got by on 10yo second hand netbooks I could see your point but that's not what you're saying.

I agree, I'd never buy a mac book pro just because I belive super powerfull laptops are pointless when you take into account the price and the battery power if you want to do serious computing on it, you just dial into a bigger computer if you need that. Laptops are all about portability.

Like a half way house between a mobile phone and a real computer.

Equaly, a £350/400 laptop is going to be utter garbage, but they are quite usefull when traveling. But they will also have crap screens and low storage and other compromises, because they are only £350-400, rather than a thousand.

Yes - I'm finding this notion of dictating "no more than minimum requirement" to be depressingly soviet.

The idea that it’s somehow wrong for business to treat their staff with anything more than the barest minimum of decency….it’s just bizarre.

Also, the things you are describing as "luxuries" are really not.  Most of the examples you have given are well within the realms of justification - maybe you just don't understand their business.  Macbook pro vs cheapo chromebook?  Have you not seen the levels of photoshopping estate agents do?

My boss recently wanted to send me to Mumbai for a one day meeting:  16 hours each way, there and back within a working week.  Oh and sorry - it's going to be economy, we can't get approval for any business class at the moment.  Where does that sit on your scale?  Should I have travelled economy - arrived in a pissed-off, sweaty heap and done a terrible job at the meeting?  Or was the "luxury" of business class justified in your opinion?  To what degree do you think an economy-only travel policy affects retention in my industry?  The point is - you don't know, and nor does the tax office.  The people who know are the ones running the business.

I don't completely disagree with you - I'm sure that sometimes small business owners buy stuff that is unnecessarily nice/good to perform the required task.  Maybe that's a bad procurement decision, or maybe it's to keep their staff happy and improve retention - or yes, maybe it's some nefarious scheme to screw the UK public out of a few quid.  unless you are going to task the tax office with delving this deep into how people run their businesses - you're never going to know.

As has been mentioned above,  amongst the worst offenders for this kind of thing are MPs - who seem to be able to claim their houses (along with furniture and running expenses) as business expenses ie:  not just tax deductable - they are claiming the full amount from the public purse, and who seem the be able to employ wives/children on their staff.  Never mind Bojo who's just gifted a random selection of misfits a job for life at an extortionate salary and a gold plated pension.

Or what about the hilarious ironic (in this context) procurement decisions by the government to buy literal tons of PPE that was insufficiently spec'd for the required task, and had to be binned.  That wasn't even just a tax fiddle - that was large scale, blatant corruption.  Are we going after that money?

Sorry - I'm irrationally annoyed at this line of discussion.  the UK at the moment is spiraling to the bottom in terms of quality of life for "normal" people.  This narrative that somehow it could be resolved/improved by people tightening their belts, holding their nerve, subsisting on plain tesco-value pasta shells, or by self employed builders buying econoline transit vans instead of ones with mudflaps and A/C - rather than the political classes (particularly tories) choosing to prioritize the needs of the population over their own grubby self interest.... really pisses me off.

I know that's not what your point is - but it's certainly adjacent to it.

If you are concerned about tax evasion/avoidance and it's impact on society - you are starting at exactly the wrong end of the list.

I belive super powerfull laptops are pointless when you take into account the price and the battery power if you want to do serious computing on it, you just dial into a bigger computer if you need that

We'll there are plenty of times where having a powerful laptop is important. Just because you haven't had the use case doesn't mean there's don't have it.

Sorry – I’m irrationally annoyed at this line of discussion. the UK at the moment is spiraling to the bottom in terms of quality of life for “normal” people

Divide and concor. Get everyone jealous convince people the wealthy are the ones earning 40,50,60, 100% more than you or it's small business owners etc. Not the people at the top really fiddling the system

I have a tiny business (me plus one). My attitude is that we spend enough oof our waking hours working so at least we should have good quality stuff to work with and the environment should be as pleasant as possible.

After trying to write a report on a train whilst the toddler opposite me waved a banana at my laptop (perfectly fine but just a bit distracting), I also decided that  first class train tickets were a worthwhile investment (particularly during the holidays).

The other thing I absolutely do is pay for the environmental option if there is one - train vs plane (even if it’s more expensive), Ecotricity etc. I don’t want to do anything with my business that I disagree with on an ethical level. That’s my prerogative.  I think paying tax is important but being able to work to my standards is the bottom line for me running my business.

The idea that it’s somehow wrong for business to treat their staff with anything more than the barest minimum of decency….it’s just bizarre. Where could such an idiotic notion have come from?

I don't know. Did anyone put forward that notion on this thread?

Image innit and image sells. Most in the above posts about equipment choices makes business sense. Pickup for a gym, absolutely, look at what the client cars in the car park are. Muscles = muscle pick up and people impressed by muscle pickups - I don't go to a gym and there aren't any pickups at the climbing wall car park, lots of T5/6 and Berlingo/Kangoo though. The local guitar shop owner has his 60s Mustang parked outside, the language school has a London bus, the hipster B4 pub has pickup, the flash hotel owner has a Merc, the hairdresser has a... .

Choosing a car when in business I had a tick list: Not BMW, Merc or Audi or even VW cos I'm not a blaireau, classy but not ostentatious, big enough to do the job, unlikely to create jealousy, not poverty.

Know your best clients, be what they expect you to be.

Laptops are small fry. I head to the west coast of the USA fairly frequently with work. My direct, business class flights are around £8k more than the cheapest option, this year I'm over 30k of spend, over the course of my career it's a house amount of cash

Laptops are small fry. I head to the west coast of the USA fairly frequently with work. My direct, business class flights are around £8k more than the cheapest option, this year I’m over 30k of spend, over the course of my career it’s a house amount of cash

But that's very different - frequent long-haul business fliers would naturally expect to fly business class for, errrr, business reasons. It's really not relevant to the OP's question.

But that’s very different – frequent long-haul business fliers would naturally expect to find themselves first up against the wall come the eco-revolution

FTFY

Take an estate agents whose staff all have £2k MacBook Pros. Clearly unnecessary item for the job, but you could argue that it gives a premium impression to customers and helps keep staff happy.

I work in the NHS and we have been given the most cheap shite laptop they could possibly find at an over inflated price. The screen on my first one broke within a week. Apparently its not under warranty too. Buy cheap buy twice.

And re pickups - i thought they had some kind of tax break thing, or was that just a few years back? Anyhow they are mode of transport for that type of business. Almost if you dont turn up in a pickup you are perceived as none professional. Daft I know.

But that’s very different – frequent long-haul business fliers would naturally expect to find themselves first up against the wall come the eco-revolution

I hope you realize not all business flyers are going for a meeting that could be done via zoom?

I hope you realize not all business flyers are going for a meeting that could be done via zoom?

Indeed, there's nothing that'll ever replace that personal connection you get doing business face to face on a golf course in California or a ski jolly to Davos.

(I may have a personal grudge against this sort of thing after a former globetrotting CEO and his underlings presided over the company that wouldn't even pay a weekly return train fare if you were working elsewhere in the UK)

I’m wondering how folk can tell the difference between a £1000 MBP and a £2000 one, just by looking.

I work in the NHS and we have been given the most cheap shite laptop they could possibly find at an over inflated price

going off subject, but that is a good example of where a shit ton of money gets wasted in the NHS, lining the pockets of the suppliers who must be creaming it in. The more you put in , the more they will put their prices up rather than the money go to the right people/ places !

When I started at a new company many moons ago, I pretty much halved their annual bill for bolts. They were spending 10’s of £1000’s a year on them.
A few phone calls and I was getting them at a fraction of what they were paying. Whether the 2nd in command there was on a backhander from the local rep, I couldn’t say ( he used to order all this before I started ) , but I was approached by said rep who inferred there would be something in it for me if I went back to them 🤨

going off subject, but that is a good example of where a shit ton of money gets wasted in the NHS, lining the pockets of the suppliers who must be creaming it in. The more you put in , the more they will put their prices up rather than the money go to the right people/ places !

We work extensively within the NHS and we certainly don't 'cream it in' – budgets are always very tight and we are often asked to reduce prices where we can (which I find frustrating, being a small employer, knowing that elsewhere in the NHS just what you say *DOES* happen).

I suppose those Macbooks are at least company assets as (presumably) are all the other noted purchases; the Gym bunny in a Merc will need to cover BIK(?) and any personal mileage/fuel(?) as will the builder with a posher van and if they want to avoid too much scrutiny over single user rules will need to hand the keys over to co-workers on occasion(?)...

A mate of mine managed to score a Shiny new Ionic as his company car, but aside from saving him less outgoings on fuel than he expected (he charges it both at home and at work) He doesn't think it's been much of a benefit overall, under the company rules it's treated as a pool car when needed so He frequently has to let other staff take it for business journeys and deliver it back uncharged. funniest of all he ended up just buying himself a used Golf GTi for the weekends and to keep his personal mileage in the company car down so now pisses money away on petrol ...

I've worked with a few contractors over the years and the hoops and loopholes some were constantly trying to dance and jump through seemed like they'd take the shine off of the toys they (or more typically their business) bought or money they banked (in the company) Indeed I remember chatting to one who'd finally gone staff and was whinging about the tens of thousands he had tied up in his 'Ltd' that he'd already paid corporation tax on but apparently couldn't touch without attracting further tax, he wanted to wind up his company and pay himself the remaining funds, but didn't want to pay any tax. My sympathy might have seemed a little forced...

Others keep a close eye on residual values of assets their company owns so they know when it can be written off and 'disposed of', that feels like the sort of thing HMRC should take a stronger interest in to me...

My point is there's always a trade-off/compromise when doing things "through the company" often it puts people a bit closer to the line legally, other times it stops them treating the toys they've bought as exclusively "theirs"... Mostly it's just about plain old tax dodging though. None of it really makes me want to set up and operate my life through a commercial entity, life is too short and I'm unlikely to actually make enough for it to ever be worthwhile YMMV of course.

I'm rather curious as to what the OP thinks the point of a business is?  Very often it is to provide nice things for the owners.

Personally my employers have given me a big screen at home, and a PC with a lot of graphical grunt as that's what I need tho' people often say 'ooh that looks nice'

I’m rather curious as to what the OP thinks the point of a business is?  Very often it is to provide nice things for the owners.

wait till the OP learns about “business class” on airlines, they’ll explode 🤯 😂

Indeed, there’s nothing that’ll ever replace that personal connection you get doing business face to face on a golf course in California or a ski jolly to Davos.

I might be missing your point but I think you are missing mine. A lot of business travel is not for meetings its doing the actual work.

wait till the OP learns about “business class” on airlines, they’ll explode

I believe (although perfectly possible and probably I am wrong) that this is where the profit is. Without business class most long hauls would not be profitable. Of course you could say more expensive economy fares would mean less people travelling so less flights. or perhaps there would emerge another behaviour?

I wasn’t telling you specifically anything. I was providing an example to illustrate the point that in some cases it’s very obvious that someone is buying themselves an extravagant treat tax-free.

And if I do, WTF has it to do with you?

My business, my earnings and my spending - and it's legal.

My business, my earnings and my spending – and it’s legal.

Agreed. When I look at my figures and I can see ways of minimising my tax exposure, why would I choose to buy a £200 phone over a £1,400 phone when that means that, out of the £1,200 saving, HMRC end up getting £480 of it. It's not illegal, it's just sensible.

why would I choose to buy a £200 phone over a £1,400 phone when that means that, out of the £1,200 saving, HMRC end up getting £480 of it. 

Because the business gets the other 75%, ya fanny. But if you want, I'll sell you that £2000 phone for £4000, and reduce your tax exposure even more. 🙄

I’m rather curious as to what the OP thinks the point of a business is?  Very often it is to provide nice things for the owners.

No shit. Pay tax on the nice things you earn from the business (in money or in kind) and we will all be happy.

Some of this discussion seems to have become muddled by people extrapolating what has been said, mixing up other taxation debates and opinions, and ultimately disagreeing with me about things I haven't said.

I’m rather curious as to what the OP thinks the point of a business is? Very often it is to provide nice things for the owners.

Personally my employers have given me a big screen at home, and a PC with a lot of graphical grunt as that’s what I need tho’ people often say ‘ooh that looks nice’

I think the same as you do, but I don't think those nice things should be tax-free. That equipment you've been given seems entirely appropriate and isn't what I've been talking about.

And if I do, WTF has it to do with you?

My business, my earnings and my spending – and it’s legal.

We're all part of a society that collects and spends tax, so it seems reasonable to discuss what's allowed. I appreciate that, as is evident in this thread, people who the current rules benefit will be defensive about it being discussed.

Because the business gets the other 75%, ya fanny. But if you want, I’ll sell you that £2000 phone for £4000, and reduce your tax exposure even more.

I trade as a partnership - for every £1 profit above the 40% tax bracket in a financial year I pay 40p. And stop it with the puerile language will you.

Because the business gets the other 75%, ya fanny. But if you want, I’ll sell you that £2000 phone for £4000, and reduce your tax exposure even more. 🙄

I think you rather missed the point there.

Because assets are cheaper inside the business the difference in cost is significantly lower too. So it's a question of a £200 Vs £1000 laptop in the personal world. Or the same, but £100 Vs £500 inside the business. I probably wouldn't spend an extra £800 on a laptop personally, but if I was running a business and it was only £400 more, then it makes a lot more sense.

It's not a question of "reduce your tax" any more than it's "why should someone pay £400 more tax, for the van without the £1000 A/C option". Yes the business would still have an additional £600 if they didn't spend it, but most people would rather have A/C than £600 even if fewer people would pay £1000 for that 'luxury'.

I will be running my business from an up turned skip.

I trade as a partnership – for every £1 profit above the 40% tax bracket in a financial year I pay 40p.

Hopefully not an accountancy partnership!