Contract Hire - Pick Up.

[Tomo1971]

I am a one man LTD company at the moment, using my personal car (a SUV) to do approx 45,000 miles a year (mainly business miles). I pay myself the 45p/25p per mile on business miles. The vehicle im using now is on personal HP that I can do a voluntary termination on in the next couple of months if need be. Its currently on 95,000 miles.

As i do need something that is proper 4wd for the role that I do, I was thinking of either buying an older 4WD (Nissan Terrano II) for around £4k or contract hiring a new pick up type vehicle.

Looking at about £440 a month (plus VAT) for a Ford Ranger Dbl Cab on a 3+36 profile with 50k miles a year allowed.

Im currently on the VAT FRS, so would probably benefit from coming off this, and then been able to claim back the VAT on the deposit and the monthly rentals.

I also assume that, as well as all servicing, maintenance, fuel etc been paid for by the business, I will be able to claim the VAT back on these.

Has anyone been in a similar situation... is contract hire likely to be a decent solution?

Any other suggestions?

Cheers,
Steve

[Alan @ BroomeAffinity]

If you're a builder or a farmer HMRC generally accept that this kind of vehicle is for business use. If you're in IT they won't.

[Tomo1971]

If you're a builder or a farmer HMRC generally accept that this kind of vehicle is for business use. If you're in IT they won't.

Thanks…. im aware of this, hence why i put "As i do need something that is proper 4wd for the role that I do"

I work in telecoms…. on the masts, you know, the ones that tend to be on hills, farms, fields….

[Alan @ BroomeAffinity]

So you did. Sorry I missed that. I have had a few IT guys asking me this question recently so I just assumed. Nice use of sarcasm in your last sentence. Does that normally help when you're asking for free advice?

But yes, you should be able to claim back VAT and obtain CT relief on all servicing, fuel etc.

You will still have to pay tax and NIC on the B-I-K.

[Notascooby]

A double cab will qualify as a Van and therefore it makes good sense to have it as a company asset.

The rules for a van are considerably more favourable than a car - there's details on company car threads on here (you'll need to search / trawl or within the HMRC guides which to be fair is pretty self explanatory.

[Sockpuppet]

If you're a builder or a farmer HMRC generally accept that this kind of vehicle is for business use. If you're in IT they won't.

Doesn't matter. Its a VAN you need to move between sites, that is all the justification you need.

[Sockpuppet]

A double cab will qualify as a Van and therefore it makes good sense to have it as a company asset.

It has to have a payload of >1000kgs to qualify as a VAN.

[Moscow Mule]

It has to have a payload of >1000kgs to qualify as a VAN.

Including the bed cover if required, which is why most of em have a payload of 1046kgs.

[BolshieBastard]

Be aware if you use this type of vehicle, it isnt classed as Private Light Goods and is subject to different speed limits on roads. If you arent careful, you'll end up with speeding tickets.

Regarding VAT you can claim back the VAT on servicing.

[subsea]

Be aware if you use this type of vehicle, it isnt classed as Private Light Goods and is subject to different speed limits on roads. If you arent careful, you'll end up with speeding tickets.

Regarding VAT you can claim back the VAT on servicing.

These vehicles are generally subject to same speed limits as cars / PLG - Ask the police link

https://www.askthe.police.uk/content/q529.htm