Originally posted by ladymuck
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Reply to: Buying an electric car
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Previously on "Buying an electric car"
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Originally posted by Fred Bloggs View Post
You'll have a hard time getting that past HMRC. You are charged BIK whether you use it or not because the rules says it's available for use even when you don't use it. For example, I tried to persuade HMRC not to tax me BIK on a company car when I had to regularly travel overseas for work. The car would be parked at the airport and I'd be thousands of miles away. My request was rejected because even though I was in a different country, the car was still available for personal use.
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Originally posted by pintofale View PostMany thanks Craig, appreciate your expert opinion, and thanks for pointing out that BIK is on the list price - seems a little unfair to me but since it's only 2% it would be churlish to complain! You mentioned lowering BIK if the car is only "available" for (say) 50% of the year - does this imply and require business use for the other 50%, or could the car be merely unused for that 50%? So for example if you typically only use the car at weekends would you declare BIK based on 100 out of 365 days?
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Originally posted by pintofale View PostMany thanks Craig, appreciate your expert opinion, and thanks for pointing out that BIK is on the list price - seems a little unfair to me but since it's only 2% it would be churlish to complain! You mentioned lowering BIK if the car is only "available" for (say) 50% of the year - does this imply and require business use for the other 50%, or could the car be merely unused for that 50%? So for example if you typically only use the car at weekends would you declare BIK based on 100 out of 365 days?
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Many thanks Craig, appreciate your expert opinion, and thanks for pointing out that BIK is on the list price - seems a little unfair to me but since it's only 2% it would be churlish to complain! You mentioned lowering BIK if the car is only "available" for (say) 50% of the year - does this imply and require business use for the other 50%, or could the car be merely unused for that 50%? So for example if you typically only use the car at weekends would you declare BIK based on 100 out of 365 days?
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Originally posted by eek View Post
Lease - 50%
Purchase - blocked so not recoverable.
Motoring expenses (VAT Notice 700/64) - GOV.UK (www.gov.uk) and VAT on the Purchase of a Car - Vantage Fee Protect if you want a readable version
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Originally posted by eek View Post
Lease - 50%
Purchase - blocked so not recoverable.
Motoring expenses (VAT Notice 700/64) - GOV.UK (www.gov.uk) and VAT on the Purchase of a Car - Vantage Fee Protect if you want a readable version
However, if you lease a car that is to be used both for the business and privately or is available for private use you will be able to claim 50% of the VAT incurred on the lease.
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Originally posted by northernladuk View Post
And the same goes for reclaiming VAT?
Purchase - blocked so not recoverable.
Motoring expenses (VAT Notice 700/64) - GOV.UK (www.gov.uk) and VAT on the Purchase of a Car - Vantage Fee Protect if you want a readable version
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Originally posted by Craig@Clarity View Post
Yes. BIK on a company car is based on the car being available to the employee for private use. So if it was available 365 days a year, then the BIK is calculated on that basis. If it was for 6 months, you disclose that on the P11D and tax it accordingly.
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Originally posted by malvolio View PostThere's nothing to stop YourCo buying a car. It's the personal benefit that is the question and always has been, and why the buy it personally and charge it option usually made more economic sense.
With the EV benefits the picture has changed somewhat, but what we don't know is how using company money to buy a personal asset is affected. I don't see a car as being any different to a summerhouse or a 54" plasma screen if it is never used for the business in any way, it's just another company asset. So the BIK question is a little unresolved.
The VAT position is clear, however. You can't claim input VAT on expenditure that is not made for the company's business or its furtherance.
The fact that it's insanely generous for EV cars doesn't mean anything beyond it's insanely generous and a great tax break if you can make use of it.
Personally I'm waiting to see what the next Gen Mini / MG roadster look like.
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There's nothing to stop YourCo buying a car. It's the personal benefit that is the question and always has been, and why the buy it personally and charge it option usually made more economic sense.
With the EV benefits the picture has changed somewhat, but what we don't know is how using company money to buy a personal asset is affected. I don't see a car as being any different to a summerhouse or a 54" plasma screen if it is never used for the business in any way, it's just another company asset. So the BIK question is a little unresolved.
The VAT position is clear, however. You can't claim input VAT on expenditure that is not made for the company's business or its furtherance.
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Originally posted by northernladuk View Post
Even if there is zero business use?
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Originally posted by Craig@Clarity View Post. My answer with anyone asking if a company car is allowed is always yes.
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