TaxTMI 
TaxTMI 
Please clarify, purchase of Walkie Talkie for communication purpose for factory is fixed asset or expense
Fixed asset
26 Aug 2015 
6 Replies 
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Asset classification: capitalisation threshold and useful-life determine whether communication equipment is recorded as fixed asset or expense.
Whether a portable communication device is treated as a fixed asset or an expense depends on its intended use and the period over which benefits are expected to accrue. If the device is used over multiple years it is capitalised as a fixed asset, subject to the company capitalisation threshold. Items below the threshold are often treated as revenue expenditure and expensed, with depreciation or immediate write-off applied per accounting policy and tax practice. (AI Summary)
Whether a portable communication device is treated as a fixed asset or an expense depends on its intended use and the period over which benefits are expected to accrue. If the device is used over multiple years it is capitalised as a fixed asset, subject to the company capitalisation threshold. Items below the threshold are often treated as revenue expenditure and expensed, with depreciation or immediate write-off applied per accounting policy and tax practice. (AI Summary)