Author Message
HMRC ADMIN 81
Subject: Expenses - Software to be used for more than 2 years 26/01/2018 14:47:02
Hi there,

You would need to contact one of our technical advisors to give you further advice on this issue. Please contact on the following link:

https://www.gov.uk/government/organisations/hm-revenue-customs/contact/self-assessment

Thanks
Anonymous
Subject: Expenses - Software to be used for more than 2 years 26/01/2018 02:53:49
Hi,

On the following page, it states that you can claim

"Computer software your business uses for less than 2 years"

https://www.gov.uk/expenses-if-youre-self-employed/office-property

I am confused by this, as the cost of buying a piece of software (as a single permanent licence) is the same whether you are going to use it for 2 or 10 years.

The only time when the length of use is related to the cost is when you are paying for the licence under a subscription model, but this is already covered under the following statement on the same page -

"Computer software if your business makes regular payments to renew the licence (even if you use it for more than 2 years)"

An example -

I buy a piece of software under a single permanent licence for £100 and then claim that as a business expense.
Two years later I find I still need to use the software for my business - what then? Would that somehow invalidate the original expense claim if I carried on using it?
The money spent/claimed is exactly the same regardless.

You can pay claim for computer equipment which will last for longer than 2 years, so why is software different?

Also, if I bought a piece of software but didn't use it for a period of time, would the 2 year time period begin when I bought it or when I started using it?

Many pieces of software utilise plugins, these are generally one off payments to add extra features to an existing piece of software, if you are going to be using the software for more than 2 years (even with a subscription model) then by default you will still be using the purchased plugins for this same time period. What about this situation?

I'd be grateful if you could please clarify this issue.

Many thanks