BTC - Adjusted trading profits - Disallowable Lease car formula

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Can anyone confirm what the denominator is in the fraction for disallowable expenditure on lease cars?
I am unsure whether it is £12,000 or the cost of the car.

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BTC - Adjusted trading profits - Disallowable Lease car formula

    It is the retail price:

    (1/2 * (Retail Price - £12,000))/Retail Price

    Kind regards
    Steve
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BTC - Adjusted trading profits - Disallowable Lease car formula

    many thanks
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BTC - Adjusted trading profits - Disallowable Lease car formula

    Another way of the calculation
    To get the allowable proportion:

    (n + 12,000)*p
    2n

    Where 'n' is the retail price
    and 'p' is lease payments made.

    Regards

    Dean
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BTC - Adjusted trading profits - Disallowable Lease car formula

    Now that is very scary because we have not done anything on lease cars, I haven't seen it in a past paper either (not that I can recall) is there any chance of this coming up? and where can i find the reading material to look at the formula and when/where to use it.

    Thanks
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:BTC - Adjusted trading profits - Disallowable Lease car formula

    this topic was not covered in the course book we use but our tutor covered it recently. today we did a question from another course book and it was in the practice exam, it was horrible cos not only was there the lease forumla to deal with but there was private usage which had to be consider too. a really horrible question.

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