Now, make private use adjustments for fixed assets

posted in Uncategorized

Businesses purchase fixed assets for a multitude of reasons. These assets could be manufacturing machines or furniture for an office, or devices like computers, or cars for visiting clients. Some business assets are also used privately – like a car that’s taken home and used at the weekend – and the portion of private use needs to be recognised in the accounts.

If you’ve been using fixed assets in Xero, you’ve probably employed various workarounds to apportion depreciation between private and business use. But now, with the release of the private use feature which is part of the newly designed assets page, it’s so much easier.

The new asset page captures details in a much simpler layout. Editing assets is much more intuitive, and actions which trigger a full depreciation rollback are now clearly demarcated from those that don’t.

Making adjustments

You can now make adjustments so full depreciation of straight line assets occurs without losing any existing data. Just set the financial year from which a depreciation setting is applicable. Xero does the rest, picking up the correct setting and depreciation rates for the asset. And you can create as many adjustments as you want.

Private use allocation

With the new asset page and adjustments feature, apportioning private use is dead simple. Create or edit an adjustment and set the private use percentage. Xero automatically calculates private and business use depreciation amounts for you. After you run depreciation, the History & Notes section shows you how much of the depreciation was due to private use so that you deduct only what’s business related. Disposing of an asset is easy too: disposals now calculate the correct numbers when there’s a private use allocation.

Reporting

Both the depreciation and disposal schedule reports now include private use information. Just run the reports for a financial year to see the details. No more manual calculations!

All in all this is a feature packed release. So go ahead and give it a whirl.

The post Now, make private use adjustments for fixed assets appeared first on Xero Blog.