Posts by Matthew Bishop4

I could really use some advice here.
I currently run a small business—registered as a sole proprietorship, VAT-paying, retail-focused—but I’m looking to switch over to a simplified tax regime. The new maximum revenue threshold of $100000 aligns perfectly with my projected growth and what I actually pulled in over the last two years (in 2017, my total receipts were roughly $71000 including VAT, all via electronic payments). When I went down to the IRS office to ask about the transition, they basically told me it would be treated the exact same way as if I were shutting down the entire business. Here’s the complication: my business assets include a vehicle that I registered at 70% of its value ($25283) and used to claim 70% input tax credits. I’ve been depreciating it using various rates based on my income, so as of the end of 2016, its book value sits at $21,490.41.
Since I handle my own bookkeeping, I’m honestly stuck on the best way to execute this transition without making a mess of things.
Thanks in advance.

Brenda Chase3 said:Don't record the entire purchase through an input invoice; instead, just record the calculated depreciation as a fringe benefit expense.
Basically, you clear the invoice if it's been paid and claim the sales tax, but you only recognize the actual expense—using the pre-tax amount as the basis for depreciation—in the amount of that year's depreciation. As of December 31, 2016.

Thanks for the help.
Just making sure I've got this straight.
For 2016, I should enter the depreciation amount under "in-kind expenses" in the P-PPI, put the older depreciation under "write-off expenses," and then from next year onward, everything goes under write-off expenses.
Thanks.

I could use some guidance here—I’m currently handling the paperwork for my small business and I'm registered for sales tax.
Last year, I picked up a smartphone for $1198 plus sales tax.
How exactly am I supposed to record this transaction in my KPI—and how does it actually show up on the P-PPI form?
In my KPI, there’s a column labeled "expenses under Section 22, Paragraph 1, Item 5."
Meanwhile, the P-PPI has a section for "non-deductible expenses under Section 33 of the Code."
Thanks.