Tax relief on Co vans

[Mustang]

I am starting to do a lot of miles for business and was looking into the option of buying a company "van" (read: estate with no rear side windows) rather than use my car. I had ruled our buying a car for the obvious tax reasons but thought the tax implications for a van were better.

WRONG!!

When I talked to the HMRC, they advised that: 1) the determination of "available for private use" was the same for a van as a car 2) the tax liability if a van is used privately is currently £500 but this will raise to £3000 in the 2007-2008 tax year.

Bottom line: despite the increased wear and tear on my car, I am still way better off claiming my 41p a mile - unless of course anyone out there knows something I have not found out..........!! :-)

[Lucifer Box]

You can claim back the VAT on the purchase of the van (if you're registered for VAT). That might make a difference depending on how much it is.

But, basically, yeah. If you use a company vehicle for any significant private mileage, you're screwed.

[Mustang]

Lucifer, its even worse than that!! You dont have to drive any miles, the taxman can "deem" that it is available for private use!! You dont even have to use it!! Sad really!!

[Lucifer Box]

Blimey!

[boredsenseless]

You could always buy yourself (i.e. your money not the companies) a really cheap car and use that for company travelling at the full reclaim rate for mileage.

This would save the wear and tear on the other car, you just have to be able to swallow your pride and drive a naff car to work. But then again you were going to use an estate so I guess you've already done that

[Tramline]

You could always buy yourself (i.e. your money not the companies) a really cheap car and use that for company travelling at the full reclaim rate for mileage.

This would save the wear and tear on the other car, you just have to be able to swallow your pride and drive a naff car to work. But then again you were going to use an estate so I guess you've already done that

That's definitely the best way to do - £500 car off ebay and then run it in to the ground whilst claiming 41p p/mile!

[DimPrawn]

I once worked with a contractor who had been at a client site for about 2 yrs on a good whack and he drove a £500 Vauxhall Cavalier to and from work every day to do just that - make a profit on the mileage claims. Boy did he get some stick from his TVR/Porsche driving colleagues.

[xoggoth]

Since new rules do not come in for a while why not buy an old van, bfik only £350, and either run into ground or sell to yourself when gordon scum lefty incompetent brownstuff starts robbing you? Tax aside, don't forget vans are a lot cheaper in the first place and a company can claim back the VAT.

[s2budd]

Tax relief on Co vans (Using a rust bucket)

Using an old car and claiming miles between my office and client sites is what I do. I use a Rover 214 with 100K plus on the clock. It drives OK and does not cost very much to run as it only has a 1400 engine. I do make quite a bit in profit on the mileage allowance though.

The disadvantage is that it is an old car, can not go above 95 miles an hour (it starts to shake) and one day it will die so it will be time to buy another car.

However my money is better off in my bank account than going towards a flashier model - but that's a matter of opinion.

[bfg]

Buy your van now.
Run it as a company van until the tax goes up.
Make sure it is very well maintained, including a major 'spruce up', tyres, clutch, timing belt etc. just before the tax goes up.
Sell it to yourself for peanuts, vans depreciate faster than just about anything else you can buy other than food!.
Then charge your milage.