FYA allowance question - Business Tax - Practice assessment 1 - Question 1.3
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VijiVijins
Registered Posts: 9
in Business Tax
Hi guys, hope you can help please. In Business Tax - Practice assessment 1 on the AAT website question 3 there is Car 2 addition (low emissions - eligible for FYA) and it is given 21850 allowance (full cost allowance) but there is a note that it has 25% private use.
Shouldn't allowance be calculated as 21850 x 75% = 16388? I am missing something?
Shouldn't allowance be calculated as 21850 x 75% = 16388? I am missing something?
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Comments
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What you say would be correct if the car was being used by the proprietor. Presumably, the Contract Manager is an employee.1
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As Peter says the adjustment occurs for owners and not employees.
Just wanted to add that in personal tax the employee would still need to include it as a taxable benefitAAT Level 4, MAAT
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Thanks very much guys, I completely missed that point0
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You're welcome0
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Hi, does anyone know how to get the allowance figures of 940 and 897?0
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Hi Kate
It's to do with the private use of the owners vehicle. You can only claim the business %age if you are the owner.
Balancing = 1175 *0.8 = 940
WDA = 1121 * 0.8 = 896.8 (rounds up) 897AAT Level 4, MAAT
ACCA in progress
F4- Passed Aug 2020
F5- Passed Dec 2020
F6- Passed Sep 2020
F7- Passed June 2021
F8 - Passed Sep 2021
F9 - Passed June 2021
SBL -
SBR - Passed Mar 22
ATX - Passed Dec 21
APM - Passed June 220 -
Thank you, is there a reason on why it is 80% as private use is 25% so in theory should it not be 75% business use?0
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The vehicles that the reduced amount applies to are 20% private use. The 25% is the managers car.AAT Level 4, MAAT
ACCA in progress
F4- Passed Aug 2020
F5- Passed Dec 2020
F6- Passed Sep 2020
F7- Passed June 2021
F8 - Passed Sep 2021
F9 - Passed June 2021
SBL -
SBR - Passed Mar 22
ATX - Passed Dec 21
APM - Passed June 220 -
Thank you! Makes sense0
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