Sole Trader Help!! - Vans & Cars

JamesB

Apologies for asking simple questions....I am a newbie and it has been a while since I have done any studies on sole traders!!


If a sole trader buys a van am I right in saying:

-Purchase price can be capitalised and qualifies for AIA (business % only)

-All expenses including insurance, petrol etc can be claimed but if there is any private use a flat £3k benefit will apply along with a fuel benefit of £550?

-Or as an alternative to capitalising the van and claiming for the above you can simply claim the 40p/45p
mileage allowance?

Your help is very much appreciated.

J

qwerty

The £3,000 is for benefits in kind for employees, not sole traders.

If there is any private use, you add back the % of costs in the tax computation that relate to the private use and restrict the capital allowances claimed too.

clegganator

Yep but depending on the price of the van it might be worthwhile keeping the van out of the business and just charging mileage. It would have to be a nail of a van that runs on thin air but possible...

T.C.

Usually a van can be claimed in full if the client has use of another vehicle, ie his own car, wife's car etc. If it is a relatively new car I usually suggest capitalising and claiming all expenses.

PGM

clegganator wrote: »

Yep but depending on the price of the van it might be worthwhile keeping the van out of the business and just charging mileage. It would have to be a nail of a van that runs on thin air but possible...

You could we be right. For someone that does 10k miles, you'd have £4,500 of allowance. That could well be more than the capital allowance, service, insurance, and fuel. Maybe..