Investments
Definition of investments
Budgetary definition of investments
Capital expenditure (excluding construction, loans, shares, grants) is expenditure on the acquisition of movable assets, provided these are not administrative expenses and immovable assets.
The classification under budgetary law depends on the useful life and/or the value. As a rule, the useful life should be at least one year.
1. vehicles
All completed vehicles (land, rail, water, air) are investments regardless of the amount. This also includes bicycles.
2. equipment and other movable property
This includes equipment, fixtures and fittings, other movable items, animals with a gross price of more than €5,000 (per item or, in the case of the purchase of larger quantities, per purchase).
A distinction must be made between this and material expenditure. Not every invoice for movable items over €5,000 is an investment. Not every capital expenditure must necessarily be a fixed asset within the meaning of § 247 HGB.
Examples of purchases of movable assets over €5,000 that are investments:
Purchase of a machine, including freight, installation, training for commissioning, “filling” the machine with operating materials for commissioning
- Procurement of 20 PCs etc. to equip a PC pool
- Procurement of 100 chairs to equip a lecture hall
Examples of purchases over €5,000 that are not investments
- Procurement of printer paper
- Procurement of consumables
All necessary expenses must be allocated to an investment. It may happen that there are invoices from several invoice issuers that are to be allocated to one investment. In the first example above, this could look as follows:
- US supplier issues invoice for the machine
- DHL invoices the import sales tax
- Customs issues the customs invoice
- German subsidiary carries out the training and installs the machine