Is software a fixed asset or an expense
- Thread starter UKSBD
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Although a license to use software is an intangible asset, it is specifically provided that capital expenditure on licensed software, and electronically transmitted software, qualifies for capital allowances as 'plant and machinery' .
If licenced software is acquired on rental, the rentals are deducted from profits over the life of the software.
If a lump sum is paid HM Revenue & Customs normally take the view that the cost of the software with an expected life of less than 2 years is written off as an expense rather than subject to capital allowances.
If licenced software is acquired on rental, the rentals are deducted from profits over the life of the software.
If a lump sum is paid HM Revenue & Customs normally take the view that the cost of the software with an expected life of less than 2 years is written off as an expense rather than subject to capital allowances.
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