Most expenses incurred by business is written off during the year, but some costs continue for several years, for example, vehicles and computers. Because they depreciate over several years, you can allocate a portion of the cost to each annual set of accounts. For instance you might say the life of the computer is 3 years so you would assign a third of the value to each year. It is a misconception that you would get more tax relief by adding a higher depreciation figure to your accounts in a year. HMRC have their own version of depreciation which is called Capital Allowances which allows you to write off up to £200,000 in a single year which is very good news for small businesses. It is complicated and you should speak to your accountant.