self employed vehicle expenses

[mathew]

Ive spent numerous hours googling this but cant seem to make sense of whats coming up so hoping that you knowledgable folk may be able to help.

im looking to get something for work along the lines of a van or pick up. with that in mind what, if any, expenses can i claim back for it? is it better to take one out on lease or to buy it outright?

[mathew]

self*

[Ganty]

Buy one then you can claim all your expenses back and at the end of the day it's all yours;)

[mathew]

Buy one then you can claim all your expenses back and at the end of the day it's all yours;)

 

when you say 'all expenses' does that include the cost of the vehicle as well?

[Purity14]

40ppm is the best option ive found instead of owning a company vehicle..

4k per year in your pocket, you just have to pay for all fuel and insurance/tyres etc.

[Ganty]

when you say 'all expenses' does that include the cost of the vehicle as well?

 

Yes I'm self employed myself

you should claim back everything you can eg. The price of the van/car ,parts , oil , fuel costs ,even throw in a few mc donalds receipts for your dinner! Lol;)

[mathew]

it just sounds to good to be true:blink:

 

am i right in saying that you claim a percentage of the cost of the van each year?

[TonyP]

it just sounds to good to be true:blink:

 

am i right in saying that you claim a percentage of the cost of the van each year?

 

You can claim for depreciation. Can't remember how much but something like 20% per year.

[Dave]

have a read of this mathew

 

http://www.googobits.com/articles/1739-tax-deduction-for-business-use-of-your-personal-vehicle.html

[merckx]

If you buy a vehicle you can offset a percentage of the vehicle cost as a capital allowance meaning you'll pay less tax on your earnings.

 

If it's classed as a commercial vehicle they give you a higher first year allowance which is 50% of the vehicle cost , a non comercial vehicle is 25%, both restricted to a maximum of £3000. Each year after that it is 25%.

 

So for a non commercial vehicle that cost £10,000.

 

In the first year your allowance is 25% of £10,000= £2,500

The vehicle is then valued at £7,500 for the second year.

 

Second year allowance is 25% of 7500 = £1,875

The vehicle is then valued at £5,625 for the third year.

 

 

So in your first year you made a gross profit in your business of say £30,000 you would take 2,500 off that aswell as other capital allowances and other expenses etc to get to your net profit which is what you are taxed on.

 

In your second year you take £1,875 off your gross profit etc.

[mathew]

If you buy a vehicle you can offset a percentage of the vehicle cost as a capital allowance meaning you'll pay less tax on your earnings.

 

If it's classed as a commercial vehicle they give you a higher first year allowance which is 50% of the vehicle cost , a non comercial vehicle is 25%, both restricted to a maximum of £3000. Each year after that it is 25%.

 

So for a non commercial vehicle that cost £10,000.

 

In the first year your allowance is 25% of £10,000= £2,500

The vehicle is then valued at £7,500 for the second year.

 

Second year allowance is 25% of 7500 = £1,875

The vehicle is then valued at £5,625 for the third year.

 

 

So in your first year you made a gross profit in your business of say £30,000 you would take 2,500 off that aswell as other capital allowances and other expenses etc to get to your net profit which is what you are taxed on.

 

In your second year you take £1,875 off your gross profit etc.

 

 

 

so where does retrieving the cost of the vehicle come in? i may be missing something here but from what youve posted shows how it offsets the amount of tax you pay at the end of the year.

[ilicos]

Mathew, Drop me a PM and I will explain to you how it works.