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Post Info TOPIC: How treat a new car park?!
CitySlicker


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How treat a new car park?!
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Hi

We are a retailer operating on premises rented from our chairman. He has recently had planning permission to turn a field he owns into a tarmacked car park for the use of our staff and customers. The business will be funding it all. My dilemma is how to deal with this now that the bills are starting to come and how to reflect it in our accounts.

For example when the invoice for the fence comes in can anyone suggest how I deal with it? Am I treating it as a fixed asset for the company even though the company doesn't own the land it is on (is the fact that we are benefitting from it the overriding factor here?). If I don't treat it as a fixed asset for the company how would I deal with it?

Many thanks in anticipation

 



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FoxAccountancyServices


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I would show this as "Leasehold Property Improvements" (Fixed Asset) and let your accountant deal with it. :)

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CitySlicker


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many thanks for the advice. I am the accountant!!

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Rhianrach


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CitySlicker wrote:

many thanks for the advice. I am the accountant!!

 biggrin Well there goes my reply because I was going to say similar to Fox.



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Steve
jasper_accountant


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The improvments (fencing e.t.c) are a fixed asset and you are correct to capitalise them. As per fox I would have the description as "leasehold property improvements" or something similar that sounds sensible.

The more interesting question will be how they will be treated for tax. The expense is likely to be of a capital nature and therefore ineligible for inclusion as a capital allowance. However some of the expense could be treated as fixture and fittings.

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CitySlicker


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yep that sounds right. thanks for the advice.



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