Businesses are financially preparing for the tax changes announced in Labour’s budget and understandably being extra cautious in their spending. One asset every company cannot get away from and, if sourced poorly, can cost your business a lot is office furniture.
What can be done?
Office furniture does not need to be just an expense. There are ways for your company to have the workspaces it needs while saving on tax or taking advantage of company allowances.
Is office furniture tax deductible?
Yes. In this article, we will discuss some of the ways your business can increase the amount of deductible tax you are paying, with information for grants and payment options to support your decisions on building your perfect office space. Please note, the options presented are not specific to your business, so please get financial/tax advice from qualified professionals to ensure these options apply to you. Additionally, not all office furniture pieces qualify for some of these allowances.
VAT
A straightforward tax to consider, but if you are a VAT-registered business you can claim the VAT (20%) back on your office furniture purchases as long as it’s for business use only.
Capital Allowance
Furniture pieces purchased can be categorised as a capital expense, which means you can claim capital allowance on the full cost of the items. Capital allowances allow you to deduct the cost of the assets (office furniture) from your company’s taxable income.
Annual Investment Allowance (AIA)
Due to office furniture being classified as a capital expense, your business is then able to take advantage of the AIA. The AIA amount is £1 million and is taken off your overall profits before tax, reducing the amount of tax your business pays at the end of the year.
Writing Down Allowance (WDA)
WDA’s are similar to AIA, but allow businesses to offset the cost of assets over time rather than immediate annual reliefs. The qualifying pieces of office furniture for WDA allow businesses to deduct a percentage of the cost against their taxable profits.
If you cannot afford to spend on a full suite of office furniture for your office, one more option available to your business is leasing office furniture. Rather than spending one lump sum on your workspace you can spread out your costs, providing your team with the furniture they need.
What grants are there for office furniture?
Another option from tax deductions and lease options are regional grants available that do cover office furniture. below is a list of regional examples currently available that could support your ambitions to build the office space your company needs:
Affordable office furniture
LOF Used Office Furniture provides high-quality refurbished office furniture available to purchase online at a fraction of the cost from new. Each piece of furniture has gone through our refurbishment process to ensure each product is as good as new, which is why we offer a 12 month parts warranty as standard on everything we sell. Take a look at our online shop to see what office furniture you could have delivered and installed ready for your workforce.
