Tax question

[ed-ectrician]

If I buy and use a car that is partly for business and partly for personal use how do you put that through (cost of vehicle, repairs, tax, insurance, fuel) on your tax return?!

Anyone know?

Thanks a lot

Ed

 

[Octopus]

Are you a sole trader? If so keep track of your business mileage and your personal mileage. At the end of the tax year, work out the percentage of each (lets say for simplicity its 50/50), you can charge 50% of ALL your tax, servicing, tyres, MOT etc. For fuel work out the approx cost per mile and do the same.

That's how I do it and my accountant is happy with it.

 

[Geordie Spark]

I kept all my bits of paper in a shoe box which at the year end I dumped on my accountant's desk. :smilewinkgrin:

 

[Deleted member 26818]

The HMRC have a milage rate for when a personal vehicle is used for business purposes.
With cars it's 45p for the first 10,000 miles, 24p after.
Motorcycles, it's just 24p a mile.
This is supposed to cover the cost of insurance, car tax, MOT, servicing, fuel and wear & tear.
The milage allowance works out considerably more than the fuel costs.
When I was working in Southend, 42 miles each way in my car, I was putting in about £50 - £60 per week.
The milage allowance then at 40p per mile worked out to £168 per week.

 

[Octopus]

The HMRC have a milage rate for when a personal vehicle is used for business purposes.
With cars it's 45p for the first 10,000 miles, 24p after.
Motorcycles, it's just 24p a mile.
This is supposed to cover the cost of insurance, car tax, MOT, servicing, fuel and wear & tear.

That's mainly used for employees using their cars for work. The situation with sole traders can be different.

 

[Deleted member 26818]

That's mainly used for employees using their cars for work. The situation with sole traders can be different.

Not as far as I'm aware.

 

[oldtimer]

Yep me to you either claim for a van but still have to show personal use then as a percentage take this off the running costs or claim a flat 45p for the first 10,000 mile and you have to record your milage so I have a spreadsheet and fill it in daily and i have a monthly total spreadsheet that does the calculations for me. I also highlight on my milages sheet the date and how much fuel I bought so if there is any problems HMRC can even see what my milage is per litre.

Just to add I buy my cars 6 months old at the auctions for 60% of the forecourt price then basically run it until it gets too costly to run works for me

 

[ed-ectrician]

That's great thanks. I am sole trader, not vat registered...yet!! I didnt know if I could just tot it up and work out percentage at the end of the year. Good to know. Does anyone know the figure that, if your business expenses go over, you have to itemise them?

I've been self employed as a DJ for the last 4 years but only ever bringing about 4 grand a year so not had to do any big money tax returns yet!!

 

[ed-ectrician]

P.s old timer - i'm in london, how do i find out about car auctions around here? At the minute i'm looking on autotrader for a ten year old astra. Seems pretty reasonable to me...

 

[simpson93]

P.s old timer - i'm in london, how do i find out about car auctions around here? At the minute i'm looking on autotrader for a ten year old astra. Seems pretty reasonable to me...

google

 

[oldtimer]

British Car Auctions been going for past 25 years but do you homework in Dec 2007 I bought a 6 month old Focus ex lease/rental I noted a few going through at around £7500 and set my highest bid at £7700 dont be tempted to go higher anyway was at the end of auction and got it for £7200 on a provisional they said you are near their valuation would you like to up the offer I said no not in this current climate so get me an answer so I can bid for another motor they accepted the bid I had to pay £230 indemnity dont know why anyhow also had to pay £120 for its first service to keep it under its parts and warranty so all in I paid £7550 the same car on the forecourt at the time was £10500 .

After that it gets oil and air filter change every year and spark plugs every 2 years and when it gets old and too costly I will get another
best thing to do is go get a list tick off the cars you want then sit down and record how much they go for then go to the forecourt and find out what the same car goes for. Also look at your insurance policy it says the "market value" that means if you bought my car on the forecourt for £10500 and wrote it off after a week then you will get paid out £7200-£7600 a lot of people get caught out with this.

remember the traders will not pay over the market price so dont get caught in a bidding war with a plonker stick to the budget ie what the traders pay