Using personal equipment for business use.

[bluphoto]

<p>So I've finally decided to take the plunge into professional (LTD) commercial photography. I tell myself that I already own the vast majority of the equipment I'm going to need, so I won't need to have much initial outlay.<br>

But on the other hand, I wonder how I go about the asset management for my photography equipment - insurance, depreciation etc when the equipment isn't actually owned by the company. Do I just "rent" the equipment to my company, or do I sell it to the company, or do I just use it and not worry about it?<br>

Can I use it in the same way as using my personal van? ie pence per mile (perhaps pence per image)<br>

I'm in the UK. Any pointers welcome.</p>

<p> </p>

[hjoseph7]

<p>Usually when you fill an application for a Business License, it will ask whether you plan to use a peice of equipment such as a car for business, personal use, or both. If you select "both", it will then ask you the percentage of time you plan to use this piece of equipment for business use. </p>

[Charles_Webster]

<p>Your accountant can figure out the depreciation schedule for all your capital equipment. If you form a limited liability corporation, your equipment can count as part of your capitalization. Renting your equipment to your company is fine if the company can afford it, but few startups can afford that kind of outlay.</p>

<p>Your best advice is from a professional accountant, not a bunch of photographers.</p>

<p><Chas></p>

[mariosforsos]

<p>Not knowing the fine details of UK corporate law (but still knowing SOME of what applies), I'll offer some of my own personal experiences which, unfortunately, come from - quite possibly - one of the most convoluted, stupid and useless bureacracies in the known universe (bonus to anyone who can guess which one that is). Mind you, the UK business registrar has an amazingly efficient helpline which can possibly help you resolve all your queries. Here's my experiences:</p>

<p>First of all, I don't think you can use your existing equipment as part of your capital contribution for a limited company. IF you want that equipment to be a company asset and be depreciated as such, you would have to sell it (not loan it) to the company. That way, the company can add the equipment to its assets and then calculate an appropriate depreciation rate. (That is the same I think throughout the world).</p>

<p>Second, normally, you can only charge insurance to a limited company for company assets, NOT for assets owned by the shareholders, even if those are used by the company. There are however some exceptions to this rule, but I'm not sure they would apply to the case of photographic equipment - for example, a company may decide to pay a director's car insurance as a component of their renumeration (i.e. instead of a part of their salary).</p>

<p>Vehicles are a VERY special category, as if you have an accident while on company business then liability can extend to the company. Therefore, you need to examine the matter in far greater detail with an accountant AND a lawyer.</p>

<p>Hope this raised some interesting questions...</p>

[hjoseph7]

<p>" Your best advice is from a professional accountant, not a bunch of photographers."<br>

Accountants are expensive !</p>

[steve m smith]

<blockquote>

<p>or do I just use it and not worry about it?</p>

</blockquote>

<p>Yes. Just use it. I don't think plumbers register their pipe wrenches and cutters or carpenters register their saws and hammers.<br>

If you have already bought the equipment for personal use you will have bought it without any regard to depreciation. If it does not figure as a business expense then you cannot claim any depreciation on it as the business did not buy it.<br>

If you are starting up a business you want to keep things as simple as possible. </p>

[Charles_Webster]

<p>@Steve, under US accounting practices and tax laws, you can most certainly depreciate something not purchased for the company when you transfer it to the company. And if you're a sole proprietor you don't even need to do paper work, everything is assumed to be transferred.</p>

<p>I just went through this with my accountant when I turned pro in 2010.</p>

<p><Chas></p>