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What is an Asset?

Posted 10 Dec 15

As a company director you will be required to file for self assessment and a tax return each year. In order for the process to be done in an accurate and correct way, you will need to keep a track of all the expenses and earnings you make for business purposes.

One of the things you will need to keep a track on throughout the year are your company’s assets. An asset is something you buy as a company to increase its value and income, or to benefit its overall operations.

Assets need to be recorded on your company’s balance sheet, and they can be either tangible or intangible.

Tangible vs Intangible Assets

The distinction between tangible and intangible assets is simple. You can think of tangible assets as physical objects that are not consumed during your company’s activity, such as buildings, company equipment and company cars.

Intangible assets are non-physical elements which build your company, such as brand name, domain names or computerised databases. They should be listed separately on your company’s balance sheet and they need to be identifiable, controlled by the company and increase its future profits. These assets tend to bring more value to the company than tangible assets, since they add to your business’ future worth.

Fixed Assets

An assets owned by the business and used in the business for at least a year is called a fixed asset. The examples of fixed assets include:

Fixtures and fittings
Motor vehicles

Current Assets

A current asset is owned by the business, however, it will be consumed or converted into cash within one year. Current assets include:

Trade debtors
Cash at bank and in hand

There is a number of ways in which you can ensure that no deadline or document is missed before you submit them. The simplest and safest of them is by hiring a professional and certified accountant, like our experts at Tawanda Accountants to take the burden of paperwork off you.

We will guide you through the process of self-assessment and tax return and take care of the financial and administrative sides of your business, so you can spend all the time you need on developing your company, without worrying about HMRC and Companies House.

If you would like to find out how we can help you manage your business in a successful way, contact us today at Tawanda Accountants. With the variety of packages we offer our clients we can ensure we will find the best one for you.