Lease Cars- disallowable payments

Ampsie

Hi,

Can anyone tell me the rules for capital allowances on lease cars?It says in my book if the card has an emission level over 160g/km then 15% of the lease payment is disallowed.

But looking at question 2.1 on BTC June 2009 there is a weird calculation they have done and i can't work it out.

Am i being dumb - is it because the rules have changed since last year?

If anyone can shed a light for me that would be great!

Ampsie
:-)

timgriff

Hi Ampsie, I have a kaplan revision pack and for each past paper the model answers use the 2009/10 tax year, and the answer is simply: 15% x £2200 = £330 added back.

I checked if it was the same on the AAT website however, and like you say the answer is a bit weird - presumably this is what was required at the time the exam was set?

*Jo

Thank you for posting this, im doing BTC but wasnt aware of this rule. Back to the books me thinks. Good luck for tuesday btw.

A-Vic

timgriff wrote: »

Hi Ampsie, I have a kaplan revision pack and for each past paper the model answers use the 2009/10 tax year, and the answer is simply: 15% x £2200 = £330 added back.

I checked if it was the same on the AAT website however, and like you say the answer is a bit weird - presumably this is what was required at the time the exam was set?

This is the same way weve been tought in college

qwerty

The rules changed in April 2009 to 15% disallowance for cars with CO2 emissions exceeding 165g/km. This is to penalise drivers of cars which cause more damage to the environment.

Before this, the restriction was made if the car had a retail price when new of more than £12,000. It didn't matter if the car was bad for the environment or not.

FYI, the old restriction was (£12,000 + P) / 2P X R, where P = retail price when new and R = rental costs. Thankfully, the new rules are easier!

Ampsie

Thanks for the replies - i'm glad the rule has changed and i hadn't completely lost the plot!!

Good luck to all - just think - this time next week BTC will be done and only PTC to go!

AMpsie
:-)

Lou1234

Thank you for this.

I'm covering the reception phone for an hour and thought I would look at a past paper while not at my desk.

This completely confused me when I was looking at the answer paper! Did a search for the word 'lease' and this thread came up! I also thought I had lost the plot as it wasn't ringing any bells for me!