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Beware websites which aren’t tax deductible

June 28th, 2012 | Posted by Accountants Auckland in Chartered Accountant Auckland | Claiming Business expenses

6597627lPing, ping, ping goes your inbox. Ring, ring, ring goes your cell phone. Tweet, tweet, tweet goes your twitter and crunch, grind, jam goes the fax machine.  With all this technology demanding instant responses it’s easy to feel like you’re constantly under attack. That being said, who doesn’t love buying a glossy new gadget but don’t be fooled into thinking that just because it’s for business there’s an instant tax deduction!

Generally, techy things with price tags over $500 aren’t instantly tax deductible (like your iBabies) but instead you get to claim a little bit each year as depreciation. This also applies to things that don’t come in shiny boxes, like Websites.  Websites can get nasty tax-wise so, unless you want to play Fightclub with the IRD, give your Chartered Accountant all your website invoices to ensure they get it right for you:

Website costs you can’t claim:

  •  – Domain names (non-deductible & non-depreciable)

Website costs which aren’t instantly deductible (capital):

  •  – Website design costs
  •  – The initial fee to register the domain name
  •  – Adding new features
  •  – Adding extra pages
  •  – Completely changing the layout

Fully deductible website costs:

  •  – Site updates
  •  – Renting space on an HTTP server
  •  – Annual renewal fee for registration of the domain name
  •  – Maintenance including updating content and adding information
  •  – Correcting minor errors or bugs
  •  – Minor style or format changes

Investing or Trading in Domain names is a different sport entirely so chat to your Chartered Accountant.

 

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