Claiming VAT on vehicle repairs - proportional to business use

[TheCyclingProgrammer]

If you have a fleet of cars available then it's a case of proving they are pool cars. If they are, and you can prove it, then there's no BIK anyway.

Ah, thanks for explaining. It makes sense that there were additional rules to allow for that scenario.

As everyone else has said, I'm not sure why OP doesn't just claim mileage if he/she is able to. If you have a relatively efficient car (and drive in an efficient manner) then 45p/mile up to whatever the limit is seems very generous to me and should easily outweigh the unreclaimed VAT on repairs (unless you buy a lemon).

[Clare@InTouch]

But wouldn't it fail because an IT contract cannot justify having a van?

http://forums.contractoruk.com/accou...4-mo-rule.html

Do you mean huge as in tax wise against a company car but still questionable against privately owned car using the 45p per mile system?

It depends on how many miles you do, and how much your fuel costs. 45p a mile is much nicer when you own a 1ltr Smart Car as opposed to when you own an Evo

I don't see an issue with an IT Contractor owning a van. You're declaring that it's not fully business use by showing it on your P11D and paying BIK tax & NI. The fact that the BIK is lower than it would be for a car isn't your fault.

[northernladuk]

Ah, thanks for explaining. It makes sense that there were additional rules to allow for that scenario.

As everyone else has said, I'm not sure why OP doesn't just claim mileage if he/she is able to. If you have a relatively efficient car (and drive in an efficient manner) then 45p/mile up to whatever the limit is seems very generous to me and should easily outweigh the unreclaimed VAT on repairs (unless you buy a lemon).

Nice little calculator to find out how much per mile your car costs...

Calculator: True cost of running a car | This is Money

[northernladuk]

The fact that the BIK is lower than it would be for a car isn't your fault.

In our house everything is my fault.....

[Clare@InTouch]

In our house everything is my fault.....

Of course. Even in my house everything is your fault.

[Martin at NixonWilliams]

But wouldn't it fail because an IT contract cannot justify having a van?

Not at all - The conditions to be satisfied are that it is indeed a van, not that the van is needed for the nature of the contract. If a van was purchased on the basis it was for business use only and you were not paying the BIK, then a challenge could arise, but the nature of the challenge would be the same as with any other vehicle.

Do you mean huge as in tax wise against a company car but still questionable against privately owned car using the 45p per mile system?

Sorry, I was referring to the savings on the benefit in kind if the company buys the vehicle and makes it available for private use.

The benefit in kind for a Van is £3,000 irrespective of its emissions etc. and there is a set fuel benefit of £564 (for 2013/14). On a car the benefit is anything up to 35% of the list price, the same percentage is applied to a fuel benefit charge of £21,100 to determine the benefit on the fuel.

For example, a £30,000 car with a percentage of 20% would have a benefit of £10,220, a van would be just £3,564 - not bad going if the vehicle is fuel efficient and you don't mind driving a van!

Even more useful for those whose hobbies etc. require a van - I have a friend whose Kayak fits nicely in the back of his company van!

[northernladyuk]

In our house everything is my fault.....

Shut it you slag.

[TykeMerc]

But wouldn't it fail because an IT contract cannot justify having a van?

http://forums.contractoruk.com/accou...4-mo-rule.html

Do you mean huge as in tax wise against a company car but still questionable against privately owned car using the 45p per mile system?

I suppose an IT contractor that also supplies and installs bulky hardware frequently as part of a Plan B could justify a van as a valid item, but that's probably relatively unusual these days and there would also be storage associated too.

[vwdan]

Just another thought, more out of morbid curiosity than anything. Say I sold/gifted my 1968 VW Beetle to the company, worth about 3 - 4000. Am I right in thinking company tax would be based on the original list price, and additionally, if I paid that price as a contribution would it nullify the tax?

And before anyone thinks I'm being too mental - I used my 1968 VW Camper as my one and only form of transport for 5 years, including business insurance.

Also,is there anything to stop you switching between using a company car and your own vehicle at 0.45p, or are you expected to make use of a company vehicle where possible?

[northernladuk]

Just another thought, more out of morbid curiosity than anything. Say I sold/gifted my 1968 VW Beetle to the company, worth about 3 - 4000. Am I right in thinking company tax would be based on the original list price, and additionally, if I paid that price as a contribution would it nullify the tax?

And before anyone thinks I'm being too mental - I used my 1968 VW Camper as my one and only form of transport for 5 years, including business insurance.

Also,is there anything to stop you switching between using a company car and your own vehicle at 0.45p, or are you expected to make use of a company vehicle where possible?

Here is a page explaining how it is worked

How to calculate company car tax | Mumsnet Cars

Here is a calculator to play with

HM Revenue & Customs: CCF-Session Ended

You get loaded depending on CO2 emissions as well. Not sure what a Camper Van puts out. Can't be good though can it?

Think you are thrashing a dead horse here. Even if any of these questions work in your favour a contrived situation to gain the best tax advantage is going to have HMRC pulling their rubber gloves on.

Bearing in mind we haven't seen anyone doing this or any advice to say it is worth it speaks volumes as well.

Bit late now but what does your accountant suggest?