Pickup through Ltd company

[Pat Phelan]

I've not really considered the leasing option as I can get a one previous owner medium size van for under £10k + vat and its value is written down over a few years as a company asset. I can then buy it from my ltd at a much reduced price after it's been used to offset profit during the write down phase.

I tend to keep them for as long as they are economical to maintain/repair so a new one every 3 years or so doesn't appeal as they are a workhorse for lumping stuff about, including my push bikes and motorbike. No messing about with trailers or bike racks, just strap or bungie them to one side. A van is a 'real' man's vehicle.

Commercial vehicle insurance isn't as cheap as private though (and with a van you need commercial even if only commuting), and you have to be careful about transferring NCD across as many insurers don't allow it to be moved back to private car later. Mirroring, where the NCD is retained on a private car but also used for an initial commercial insurance is probably best of both worlds option.

+1
Vans are the way to go, trust me I should know. I use mine 95% for work so it is a no brainer.....

[Hobosapien]

I've not really considered the leasing option as I can get a one previous owner medium size van for under £10k + vat and its value is written down over a few years as a company asset. I can then buy it from my ltd at a much reduced price after it's been used to offset profit during the write down phase.

I tend to keep them for as long as they are economical to maintain/repair so a new one every 3 years or so doesn't appeal as they are a workhorse for lumping stuff about, including my push bikes and motorbike. No messing about with trailers or bike racks, just strap or bungie them to one side. A van is a 'real' man's vehicle.

Commercial vehicle insurance isn't as cheap as private though (and with a van you need commercial even if only commuting), and you have to be careful about transferring NCD across as many insurers don't allow it to be moved back to private car later. Mirroring, where the NCD is retained on a private car but also used for an initial commercial insurance is probably best of both worlds option.

[Naylz82]

IMO if you want one get one. If you want to save a bit of money don't. For me there just isn't enough money to be saved to have something I don't really want. Do the sums to n'th degree doesn't really help anything.

With all due respect I think I made it clear that with my lifestyle a pickup is a great option, so from a personal perspective the first point is that its a vehicle I want, not only getting one for trimming a bit of tax.

Secondly I think we're all here to try and shave a bit of tax here and there if possible, so if I can then getting one through the business seems a no brainer rather than on a personal lease.

Thanks for replies so far.

[northernladuk]

IMO if you want one get one. If you want to save a bit of money don't. For me there just isn't enough money to be saved to have something I don't really want. Do the sums to n'th degree doesn't really help anything.

[Naylz82]

Thanks for the responses people.

Here is the calculation based on me only doing 2500 business miles per year (which will come to an end in august following 2 year rule)



https://ibb.co/fRUaRT

BIK is £462.30
But as you can see corp tax relief is only 19%??

Thanks

[BR14]

They’re pretty clear that as long as it’s a genuine commercial vehicle with a genuine 1 tonne load capacity then you’re good....... for now....

I still wouldn’t drive one of those tulipboxes though as they’re just crap.

horses for courses, mate, - we toured a five piece band around southern france in an L200 mitsi with a trailer. - bulletproof. <apart from a small delay in my mental translation of - 'vents violonts' on a bridge approach)

[Lance]

I thought pickups as company cars was getting risky
https://www.businesscarmanager.co.uk...y-car-drivers/



Plenty.
https://www.google.co.uk/search?q=pi...hrome&ie=UTF-8

They’re pretty clear that as long as it’s a genuine commercial vehicle with a genuine 1 tonne load capacity then you’re good....... for now....

I still wouldn’t drive one of those tulipboxes though as they’re just crap.

[northernladuk]

I thought pickups as company cars was getting risky
https://www.businesscarmanager.co.uk...y-car-drivers/

Pretty sure this has been discussed on here before,

Plenty.
https://www.google.co.uk/search?q=pi...hrome&ie=UTF-8

[Hobosapien]

Recently been looking into doing similar though with a van not pickup.

BIK is income tax rate (20% if not in higher tax bracket) of the standard rate for commercial vehicles (£3350 currently, according to that gov.uk link), so £670 for standard 20% tax bracket.

BIK for company purchased fuel used for personal journeys is similar tax rate of the standard fuel rate of £633, so £126.

VAT can be reclaimed in line with percentage of non-personal use. So if using the vehicle 50/50 you can reclaim half the vat back. I've seen mention of a clampdown on those pickups where they are not classed as commercial unless have a 1 tonne load capacity, to stop people putting them through their business with double cabs and sod all payload, so that would need looking into. I prefer a van which is commercial whatever the size and seat arrangement afaik.

Ltd also has a 13% NI to pay on the BIK.

So depending on how much commercial use you can get out of it it may be worth doing. Still undecided myself as I don't really have much use for a van as a plan B unless I go semi-pro on car boots and markets to clear all the junk I've accumulated over the years.

I think the above is correct from my so far limited research but happy for others to put me right if necessary.

[NotAllThere]

I thought this was about a Tinder/Grindr subscription...

[Lance]

Dunno where £462 has come from. The BIK on a commercial vehicle is capped at £4K. So you pay £1k tax. On a new vehicle at c. £20k that’s saved you £3k tax in year 1.
That 20k is offset against CT as well.

Is it worthwhile? Depends on mileage, amount of personal use (100% it seems), how much you pay for it, how long you keep it, depreciation when you sell it. Etc. Etc.

Anyway. Pickups are all tulip with suspension from before the Romans. So factor that in as well.

[Lance]

https://www.gov.uk/expenses-and-benefits-company-vans

[Naylz82]

Pretty sure this has been discussed on here before, but nothing I can find gives me the answer to what I require!
Anyway coming to the end of a personal car deal and its going back.

Also hit the 2 year rule in august so can no longer claim mileage to clients place of work.

Due to lifestyle I quite fancy a pickup (have an allotment, enjoying biking, live quite rural so 4x4 also ticks another box etc) so all round a pickup seems a good option for me.

I thought that I would look at getting one through the business due to the (perceived) savings.

Anyway my accountant did some math and there was virtually no savings to be had through getting it through business.

I am a 20% tax payer therfore the BIK (as its classed as LGV) will only be £462ish per year so that doesnt have a big impact.

I only do approx 2500miles per year claimable mileage and approx the same private so the pickup would be 50/50 business/private split, therefore not entirely for business purposes.

Now the big thing I think I have misunderstood or misread is that only 19% of the running costs (by that I mean the lease payments, insurance, tax etc) are a claimable expense,whilst I thought 100% would be claimable as an expense?

So rather than be able to write down say approx £4.5k per year against corp tax my accountant has told me only 19% (approx £1k) is claimable.

Very confused so any pointers or contractors in similar position that can advise would be much appreciated.

Thanks
S