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Expensive car lease calculation


Sole trader client has a leased car with a value of £20705 and lease payments of £6004 in the year that I am looking at. Private use is 50%

I have done the normal calculation to remove the disallowable element of the lease costs and then calculated an addback of 50% on the allowable amount.

I think this is correct but have not done one for so long I am having doubts! Perhasp someone could verify

Thanks in advance


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Depends on date of lease
If before 6 April 2009 (for income tax business) then the add back is based on the old formula, further resticted to business use - so in essence you are right.

For completeness the position for cars leased on or after 6 April 2009 (1 April for companies) is that the add back is 15% if the car emits more than 160 g/km and nil otherwise, irrespective of cost. The disallowance for personal use in a sole trader or partnership would then apply to the business use so calculated.

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