Depreciation of PC components
May 19, 2011 | 25,00 EUR | answered by Oliver Burchardt
Hello dear tax experts,
Let's assume the following business model:
A company rents individually assembled servers to its customers. In order to serve its customers quickly, various hardware components (RAM, hard drives, cases, etc.) are purchased in stock and assembled into a server when needed.
Some servers are rented out for several years, but some are also terminated and re-rented to other customers within a few months. The hardware of the server is adjusted and rebuilt according to the customer's wishes each time.
My questions:
- How should the servers/components be depreciated? Due to the business concept, the components sometimes change servers on a monthly basis. There is no fixed depreciation object as a result.
- What happens to components that were purchased "in stock" but may never have been installed? Are they somehow depreciable/activatable or do they remain in stock? What happens to them when they are disposed of after x years?
Dear inquirer,
Thank you for your inquiry, which I am happy to answer as part of an initial consultation.
In the case you described, I would recommend utilizing the option of component-based depreciation of assets introduced by the BilMoG, as per the prevailing opinion in the literature.
If physically separable components are replaced, which are substantially valuable in relation to the entire asset (in this case, the server), a separate useful life should be determined for each individual asset and depreciated accordingly.
In your specific case: if you acquire a circuit board that you interchange monthly in your server, and typically use this board for 3 years, you should activate the board separately in your asset accounting and depreciate it over three years. This means that the depreciation is independent of the actual location of the board. However, please note the regulations regarding low-value assets up to €150 and between €150 and €1,000 for tax purposes.
In my opinion, components that you have purchased in stock should also be activated in fixed assets and depreciated if you acquired them with the intention of installation and subsequent rental. If these components are eventually disposed of, you should book an expense equal to the difference between the book value and the sales proceeds (or the full book value if you receive no money).
I hope this information has been helpful in your case.
Best regards,
Oliver Burchardt
Tax consultant
