Here's how to record, in FreeAgent, the purchase of a capital asset your business buys after its FreeAgent start date.
The asset will be handled differently if you bought it before your FreeAgent start date but after your company start date, or if you personally bought the asset before the company start date.
When you enter the transaction, simply put it to the one of the asset purchase categories and tell FreeAgent what the asset's life will be.
For capital assets, it's also important to put a detailed description of the asset, and, if you can, to upload a scanned image of the receipt or bill showing the purchase of the asset. This is because capital assets are tax-sensitive and your accountant, or a tax inspector, may need to see further information.
So, simply categorise the transaction using one of the four asset purchase categories, which are right at the bottom of the category list, when you enter a bill...
...or an out-of-pocket expense.
If you're entering a bank payment, there's an extra step involved. You need to choose Purchase of Capital Asset for the transaction type, under the Money Out list, then choose one of the four asset types.
Choose the asset's life from the drop-down menu.
Put in a detailed description of the asset. This is to help your accountant or a HMRC inspector, as assets are a tax-sensitive area.
Then upload an image of the receipt or bill, if you have one, and save your transaction.
Then when you go to the Capital Assets screen, you'll see that FreeAgent has put in the asset's cost here, and is working out the depreciation for you.
So that's all you need to do to make it do that. Just explain the bill, bank payment or out-of-pocket expense, as one of the four different types of capital asset, and choose the asset life span. FreeAgent will do the rest.
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