Fixed Asset Register — sign off depreciation

The £8,000 laptop she expensed three times

A director we worked with had been running a small architecture practice for two years. Every time someone in the studio needed a new machine — and architects need expensive machines — she bought a £4,000 laptop on the company card and dropped it into Computer Expenses. Two years in, eight machines, £32,000 of "expenses". Her P&L looked dreadful and she could not work out why.

The first conversation with her new accountant unpicked it in ten minutes. Those laptops were not expenses. They were fixed assets — items with a useful life over twelve months, owned by the business, used in the business. The cost should have been capitalised, sat on the balance sheet, and depreciated over the laptops' useful life (three years is conventional). The P&L should have seen only the annual depreciation charge — around £1,300 per laptop per year — not the whole purchase price.

Worse, HMRC has separate rules for tax. The Annual Investment Allowance lets you deduct up to £1m of qualifying plant and machinery in the year of purchase. Her laptops would have qualified, but the deduction sits inside the corporation tax computation, not on the operating P&L. She had been running her business on numbers that were doubly wrong — overstated expenses on the P&L, missed AIA claims on the tax return.

The Fixed Asset Register is what stops this happening. Every asset gets one row. Cost, useful life, depreciation method, accumulated depreciation, net book value. The engine handles the rest.

What the Fixed Asset Register is

A list of every asset you own that has a useful life over twelve months. Typical entries:

• Computers and IT equipment — laptops, desktops, monitors, servers.
• Vehicles — cars, vans, motorcycles owned by the company.
• Plant and machinery — anything in a workshop or production setting.
• Office fit-out — partitions, kitchens, lighting installed by the business.
• Software licences with long terms — usually a perpetual licence or a long-dated subscription paid up front.
• Furniture — desks, chairs, storage if individually material.

Each row holds:

• Cost — what you paid, net of recoverable VAT (if VAT-registered on the standard scheme).
• Acquisition date — when the asset entered service, not when the invoice was raised.
• Class — Computer Equipment, Vehicles, Office Fit-Out, etc. Drives default useful life and depreciation method.
• Useful life — months or years over which the asset will be depreciated.
• Depreciation method — straight-line, reducing balance, or units of production.
• Accumulated depreciation — total depreciation charged to date.
• Net book value — cost minus accumulated depreciation. The number that sits on your balance sheet.

Why it matters

Two parallel systems care about your fixed assets, and they don't share a register. Your accounts (UK GAAP / FRS 102) need depreciation — a non-cash charge that spreads the asset's cost over its useful life. Your tax (HMRC Capital Allowances) needs allowances — AIA, WDA, FYA — which are similar in concept but follow HMRC's rates and rules, not yours.

The FAR is the source of both. Get it right and the accounts and the CT600 both flow off it cleanly. Get it wrong and your accountant rebuilds it from scratch every year, on the clock.

What's on the FAR page

Navigate to Reports → Fixed Assets to see the register. The list shows every asset across every entity:

• Tag — the asset's unique identifier, auto-generated from the class prefix and a sequence (e.g. CE-0042 for the 42nd computer equipment asset).
• Description — free text, usually "Director's laptop", "Workshop CNC mill".
• Class — Computer Equipment, Vehicles, etc.
• Acquisition date.
• Cost.
• Accumulated depreciation.
• NBV.
• Status — active, disposed, fully_depreciated, impaired.

Filter by class, by entity (if you have multiple companies in the tenant), by status, by date range. The PDF export at the top right produces the document your accountant needs.

The monthly depreciation cron

Depreciation is a non-cash charge that the engine posts automatically on the first of each month. The journal looks like:

DR  Depreciation Expense         £1,344.44
    CR  Accumulated Depreciation         £1,344.44

Posted per asset, per the policy on that asset. If you have 30 assets each with a different useful life and method, the cron walks the FAR and posts 30 individual journals. The result rolls up into the depreciation expense line on your P&L and the accumulated depreciation line on your balance sheet.

The cron handles three methods:

• Straight-line. Cost ÷ useful life in months = monthly charge. Most laptops, vehicles, office equipment.
• Reducing balance. A percentage of NBV each month. Used for assets that lose value more rapidly in their early years — cars especially.
• Units of production. Charge proportional to actual usage (e.g. hours run on a CNC mill, miles driven on a van). Requires monthly entry of the usage figure.

Pro-rata first month

If you acquire a laptop on 14 February, the engine does not charge a full month of depreciation in February. It pro-rates — 15 days out of 28 in this case — and posts only the partial charge. From March onwards the full monthly charge applies. The same rule fires on disposals: if you sell an asset on 14 February, you get pro-rata depreciation for the days you held it that month, then disposal journal.

Cron prerequisites

The depreciation cron is a scheduled worker on Cloudflare. To post journals into your tenant D1, it calls back to the Cloudflare API and needs CF_API_TOKEN set as a secret on the worker. This is normally configured during tenant provisioning — but check Settings → Integrations → Background jobs if you suspect it's missing.

If CF_API_TOKEN is not set, depreciation does not auto-post. You would have to trigger each month manually via Reports → Fixed Assets → Run depreciation — which works, but it's the kind of monthly task that gets forgotten and then surprises you at year-end with eleven months of missing journals.

Year-end sign-off

A four-step walkthrough at year-end:

1. Open Reports → Fixed Assets. Filter by status active.
2. Scan for orphans. Any asset you sold or scrapped but never logged the disposal of? They sit here, still depreciating, still on the balance sheet, gradually accumulating phantom NBV. Dispose them properly (next section).
3. Sanity-check the depreciation total. Open the P&L for the year. Compare the Depreciation Expense line to your expectation — sum of (cost / useful life) for the assets active during the year, plus or minus disposals. Anything wildly off the expectation means the cron has missed a month or an asset is misconfigured.
4. Check the year's additions. Did the £4,000 laptop you bought in October actually land on the FAR? If you posted the purchase to Computer Expenses on the P&L without a corresponding asset row, the cost is on the wrong side of the balance sheet. Catch it now; fix the journal (see chapter 5 on locked periods before you do).

Disposals

When you sell or scrap an asset, the FAR needs to know. Open the asset, click Dispose, and enter:

• Disposal date — the date the asset left the business.
• Sale proceeds — cash you received. Zero if you scrapped or gave it away.
• Proceeds account — defaults to Sundry Income but configurable per disposal. Some businesses route disposals into a dedicated Asset Sales account on the P&L for clarity.

The engine posts:

DR  Bank (or AR)             [proceeds]
DR  Accumulated Depreciation [accumulated to disposal date]
    CR  Asset cost                       [original cost]
    CR  Gain on Disposal                 [if proceeds > NBV]
DR  Loss on Disposal                     [if proceeds < NBV]

The gain or loss flows to your P&L. The asset's status flips to disposed and it drops off the active FAR.

Partial disposals

When you sold three of a fleet of ten identical laptops bought as a batch. Open the asset, click Dispose → Partial, enter the proportion (3/10 = 0.3 or 30%). The engine reduces the asset's basis by 30%, posts a disposal journal for the disposed portion only, and leaves a 70% asset still on the FAR depreciating against its remaining useful life.

Impairment and write-downs

Sometimes an asset is suddenly worth less than its NBV — without the business having disposed of it. The workshop floods and the CNC mill is half-functional. The proprietary software you capitalised becomes obsolete because the supplier went bust. The 18-month-old laptops are still worth on paper £2,000 each, but the market price for the same machine has dropped to £600 and you'd be lucky to get that on eBay.

This is impairment. The engine handles it via Asset → Impair:

• Enter the new recoverable amount (what you think the asset is now worth).
• The engine posts: DR Impairment Expense / CR Accumulated Depreciation for the difference between NBV and the new recoverable amount.
• Future depreciation continues, but from the new (impaired) NBV over the remaining useful life.

Impairment is a permanent write-down. You do not get to write it back up later if the market recovers (FRS 102 doesn't allow reversal of impairment on fixed assets in most cases). Use it sparingly and document the reasoning — the asset's audit trail captures the impairment date, amount, and a free-text justification field that your accountant will read.

Multi-currency assets

If you buy an asset in a currency other than your functional currency — a USD SaaS perpetual licence, EUR machinery from a German supplier — the asset sits on the FAR in the foreign currency. The engine revalues it at each month-end at the current FX rate. FX gain or loss posts to a holding account on the balance sheet, not to P&L.

On disposal, the realised FX gain or loss (the difference between the rate at acquisition and the rate at disposal, applied to the asset's value) flows through to the P&L. Up to that point it's an unrealised number sitting in equity.

Component depreciation

For complex assets — a building with separate HVAC, lifts, fit-out, structure — FRS 102 lets you depreciate each component over its own useful life. The structure might be 25 years, the HVAC 15 years, the carpets 7 years. When the carpets need replacing in year 7, they're already fully depreciated; the building's other components carry on as normal.

In Blankitt: open the asset, switch to Components tab, add each component with its own cost, useful life, method. The depreciation cron then walks each component separately. Most small businesses won't use this — but if you own your premises and capitalised a refurb, it's worth knowing it exists.

HMRC Capital Allowances helper

Reports → Fixed Assets → Capital Allowances. Walks your FAR and computes the corporation tax claim:

• AIA (Annual Investment Allowance) — £1m per year of qualifying plant and machinery deductible in full in the year of purchase.
• WDA (Writing-Down Allowance) — 18% reducing balance for the main pool, 6% for the special-rate pool (long-life assets, integral features).
• FYA (First Year Allowance) — 100% deduction in the year of purchase for qualifying assets (electric cars, plant for designated freeport sites).

Output is a one-page summary you (or your accountant) drop into the Capital Allowances section of the CT600. Doesn't replace professional judgement on edge cases — what counts as plant vs. premises, integral features, structures and buildings allowance — but does 80% of the heavy lift on the straightforward stuff.

Fixed Asset Register PDF

The deliverable to your accountant. Reports → Fixed Assets → Export PDF produces a one-page summary with every asset, cost, accumulated depreciation YTD, NBV, and a footer breakdown by class. Save it to your year-end folder; send a copy to the accountant before the handover meeting.

Tips

• Don't capitalise items under your threshold. Default is £500 per item — set in Settings → Accounting Policies → Capitalisation threshold. Below that, post to Office Equipment or similar expense line.
• Useful life is a judgment call. Laptops 3 years is conventional; vans 4-5; office fit-out 7-10. Be consistent year-on-year — switching from 3 to 5 years for laptops mid-asset-life creates a prior-period adjustment your accountant will query.
• HP and finance leases need care. If you bought a £25k van using HP, only the cash deposit + monthly principal goes through the FAR; the interest is a P&L expense, not part of the capitalised cost.
• Don't depreciate land. Buildings yes, land no. Land has indefinite useful life. If you bought a freehold, split the cost between land (non-depreciating) and buildings (depreciating) — your conveyancer will have given you a rough split.

Up next

Chapter 5 is the period lock. Once your bad-debt review is done, VAT relief claimed, fixed assets signed off, and the year's adjustment journals posted — you lock the period. From that moment, the trial balance is gospel and no one — not even you — can back-date a journal into the closed year without an audited unlock event.