Question

(e)        Purchase of a Dell Desktop Computer

On 13 January 2018, Corey buys a Dell desktop computer at a cost of $1,840 from JB Hi-Fi. Corey uses this desktop computer exclusively to research sports events and write sporting articles for his employer, The Daily Mail.

Corey received a $200 JB Hi-Fi gift card from his family as a Christmas present in December 2017. Corey therefore bought the computer by redeeming the $200 gift card and putting the balance of $1,640 owing on his personal Visa card.

                        Note:     There are 169 days from 13 January 2018 to 30 June 2018.

- Can Corey claim any deductions for the purchase of his dell desktop computer?

Answer 1

Answer: Corey, being an employee of "The Daily Mail" cannot claim deductions for the purchase of his Dell desktop computer. He can ask his employer to reimburse him for the cost of the laptop ($1640); since he is exclusively using it for official purpose (research and writing). Once The Daily Mail reimburses Corey for the cost, they will then be able to deduct the cost as a business expense. Corey can neither include the cost in his employee income nor claim any deductions under the act starting from 2018.

Before the year 2018, un-reimbursed employee expenses were allowed to be deducted by the employee from his income if they exceeded 2% of his adjusted gross income.

Moreover, the mode of payment (personal Visa card) is insignificant here; until and unless the purchase is made for official purpose and has been used exclusively for the same.