Lcd Tv As A Tax Deductable Item

[blontic]

I have had a few people say to me that I can buy an LCD TV and claim it on my personal tax saying I use it as a PC monitor at home for business use.

I work in the IT industry and do alot of work from home, usually claiming upto 80% on my PC hardware.

Has anyone else done this before? I would love to buy a new Sony LCD and claim 80% back on tax.

[ozdoc]

I have had a few people say to me that I can buy an LCD TV and claim it on my personal tax saying I use it as a PC monitor at home for business use.

I work in the IT industry and do alot of work from home, usually claiming upto 80% on my PC hardware.

Has anyone else done this before? I would love to buy a new Sony LCD and claim 80% back on tax.

Which 80% of your TV viewing is for buisiness use given that you are in IT?

?Cybershak. (Mmmm... Erin McNaught. )

[AndrewW]

Has anyone else done this before? I would love to buy a new Sony LCD and claim 80% back on tax.

Can you pass the 'straight face' test ?

ie. When you are sitting in a room with an ATO auditor, can you explain to him with a straight face how you use the tv for business purposes ?

Andrew.

[blontic]

I think I could

Don't they just look at the LCD side of it and not worry about the size. If I get asked I can say it's the only monitor I have. I like large font.

You guys keep using the word tv when in fact it is a LCD screen.

[aztec]

Speak to your accountant but I would have thought you could claim 100%. It should have a depreciation schedule associated with it so you get 100% back over 5 years.

[pgdownload]

Basically I'm not sure where you're getting 80% from? You can put down what ever deductions you like in a return, but I suspect an audit will see you revising these numbers I'm no tax guru but generally immeadiate100% deductions only apply to business equipment under $300 in cost. Over that amount and you have to claim deductions over the effective life of the item:

Computers have an 'effective life' of 4 years. TVs have an effective life of 10 years.

The diminishing value method

Base value x (days held / 365) x (1.5 x asset’s effective life)

where the base value for the income year in which an asset’s start time occurs, is the asset’s cost. For a later income year, the base value is the asset’s opening adjustable value for that year

So for a $3000 TV

Deduction Claimable Year1 = 3000 * 1 * 1.5 / 10 = $450

Deduction Claimable Year2 = (3000 - 450) * 1 * 1.5 / 10 = $382

Deduction Claimable Year3 = (3000 - 450 - 382) * 1 * 1.5 / 10 = $325

etc. (for 10 years)

By the way, The example the Tax Office gives seems to suggest that if you say you're using the TV as a monitor for buisness only they have no issue with that. They are also quite happy if you want to say you use it 50% for gaming and 50% for business (just pro rata the figures above - ie start with a value of $1500)

The prime cost method

Basically the other depreciation option. This simply decreciates the item an equal amount over the effective life. So for the $3000 TV

Deduction Claimable Year1 = 3000 * 1 * 1 / 10 = $300

Deduction Claimable Year2 = 3000 * 1 * 1 / 10 = $300

Deduction Claimable Year3 = 3000 * 1 * 1 / 10 = $300

etc. (for 10 years)

You get more money up front using the first method ($1660 in the first 5 years) but you get to claim 100% of the $3000 over ten years using the second method. The first method only allows you to claim $2400 of the $3000 over the 10 years.

As an aside, I would also be checking into your 'home office' setup. Not sure if you're making any deductions there but as I recall the ATO tightened up on this a lot. It used to be you could just designate a room as your 'office', but now days the office needs to be a totally seperate area on the property (ie access is only via its own external door.

Note, I'm not an expert in tax so the above info might be all wrong. Feel free to give the ATO a call and confirm (seriously, they're actually pretty helpful on stuff like this)

Regards

Peter Gillespie

PS You're claim that its an 'LCD monitor' not a TV isn't really relevant. The depreciation schedule is designed to mimic an items drop in value / use over the years. A PC (the motherbord, chip, etc.) can generally be seen as obsolete after 4-5 years. However a TV/Monitor can easily be retained for 5-10 years by most owners. This is especially the case for an item that could double as two things (ie a TV and a monitor) - This is how the ATO would view things I suspect.

That said, Fill out the numbers and if you get audited but have some plausible 'straight faced' mistake about your understanding and there's not too many other 'mistakes' then the ATO will probably just revise the numbers and ask you to pay the correct amounts.

[dodgyblue1503560789]

Can you pass the 'straight face' test ?

ie. When you are sitting in a room with an ATO auditor, can you explain to him with a straight face how you use the tv for business purposes ?

Andrew.

Let's put it this way, you probably can claim it if you buy an LCD/Plasma monitor (ie. without a built-in TV tuner) and you hook up your PC to it and use it as a monitor for your PC. Just because your PC also has a twin DTV tuner and 1 TB storage containing your latest collection of legally derived DivX that you happen to store for your overseas friends and a fully functional mediacentre is just pure happenstance.

The straight face argument is that - It is not a TV as there is no TV tuner. It is a display monitor because it is hooked up to the computer.

Dodgyblue

[blontic]

Thankyou everyone for your information. I think I need to find a good accountant.

[Mr.Bitey]

Can I interest you in Bitey's Mobile Accounting Service ? ;-)

Its the only mobile accounting service that lets you claim Mon$ter Cables as a business deduction! Thats Right - I'll bill you $299! (per linear meter or part there of) on seperate invoices!

Heres some customer testomonials:

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"He also fixed a dodgey lock on my security door - man, that van's got eveything"

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Cheers,

Bitey

(Bitey Mobile Accounting Service is a wholly owned subsidiary of Whyatvan Enterprises, Antigua)

[fRuItCaKe.]

We did it for our projectors

Used for "onsite work for presentations and training for clients"

[Mr.Bitey]

Used for "onsite work for presentations and training for clients"

Whats the bet someone from the ATO has just entered that into their search engine :-)

Bitey Mobile Accountants would have introduced a typo (ie spell training with a 7) to avoid such a search!

Cheers,

Bitey

[OakenShield1]

Monitor is the key word here. Thats part of the reason we purchased a "Monitor" without a tuner

We'll see how we go!

[BuDWiZe]

my accountant says even with inbuilt tuner doesnt matter. if your PC is hooked up to it thats it.

its not your fault this new larger screen you require comes with a inbuilt tuner as they ALL come with a inbuilt tuner at such n such size.

all u got to do is prove your work machine hooked up to it and show taht it is used for work purposes.

[merovingian]

If the item in question is used 10% for work and 90% for pleasure, then you can only legally deduct 10% of its depreciation. It's a similar story for services like broadband costs.

http://ato.gov.au/individuals/content.asp?...ge=6#P321_38995

If it looks like a rort and smells like a rort, then it probably is a rort.

[fawlty99]

You can claim anything as a tax deduction or depreciate an asset ASSUMING you can prove it's for business purposes. Another point is that the business must meet ATO tests in order to qualify - e.g. you can't register as a business & then start claiming deductions for gear automatically.

Also the onus is on you to prove it. The ATO auditors are not dills & have seen every scam in the book. They can smell a rat a mile away. That being said they can't check everyone & rely on computer matching and profiling to select who to audit.

[Anthonyw]

I'd imagine if you could show the nexus in earning assessable income and kept a logbook showing the business use portion you would have no problem claiming the business portion based on Peter's calcs above.

[Chui2]

Carrying out such a blatant rip-off of the taxation system also precludes you from whinging about things such as roads not being fixed, not enough facilities at the local public school, how long you have to wait at the local hospital etc, etc.

FFS, you are in the IT industry, so you probably earn a decent salary. Is it too much to ask that you pay your share according to the law.

Sorry for the rant, but this sort of rort just sickens me

[pc9630]

Carrying out such a blatant rip-off of the taxation system also precludes you from whinging about things such as roads not being fixed, not enough facilities at the local public school, how long you have to wait at the local hospital etc, etc.

FFS, you are in the IT industry, so you probably earn a decent salary. Is it too much to ask that you pay your share according to the law.

Sorry for the rant, but this sort of rort just sickens me

Firstly all of the above is covered by state goernment tax is federal it's only the inercity highways the federal government bothers with.

Secondly, I too am looking at this for the same reason I howevr feel morally correct in doing so as I have poor eye sight (clinically proven seeing I have lost nearly 75% in one eye and have had 2 eye operations) and I use a 19" at 800x600 to see the thing and working on laptop at home 800x600 when the res should be 1600x100 and I can certainly use the higher res on a bigger screen.

Also 2 accountants suggest it will be no different to broadband or anything else used at home for both work and home entertainment. percentage of use is about the only questionable thing.

[peterp1503559603]

Firstly all of the above is covered by state goernment tax is federal it's only the inercity highways the federal government bothers with.

Not true -approximately 40% of state revenue comes from federal taxes in terms of grants. This allows state governments to pay for things they are responsible for managing - ie health, public housing, education.

So fraudulently claiming tax rebates on LCD televisions kills uneducated homeless little babies.

The ethical question to ask - is the primary reason this equipment has been purchased to derive income ?

In reality our taxation system is too complicated with a lot of grey areas, too many legitimate deductions don't fit into the above ethical frame work

I will hold off on the rant about taxation reform, socialist experiments and my desire for a benevolent dictator.

[Chui2]

Firstly all of the above is covered by state goernment tax is federal it's only the inercity highways the federal government bothers with.

Secondly, I too am looking at this for the same reason I howevr feel morally correct in doing so as I have poor eye sight (clinically proven seeing I have lost nearly 75% in one eye and have had 2 eye operations) and I use a 19" at 800x600 to see the thing and working on laptop at home 800x600 when the res should be 1600x100 and I can certainly use the higher res on a bigger screen.

Also 2 accountants suggest it will be no different to broadband or anything else used at home for both work and home entertainment. percentage of use is about the only questionable thing.

How pedantic do you want to be? The point of my post was quite obviously to point out that this is a rort.

So tell me the State Government taxes that cover all the costs of these items.

And where does the original post mention eyesight problems, or even the size of the monitor being purchased. In fact he implies that he will be purchasing a 'monitor' that will be bigger than that which is normally used. These are things that you have just added due to your own situation.