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Self employed capital allowances on a work van and mileage

Hi All

The question relates to claiming capital allowances as a self employed person v claiming mileage.

My understanding is that for example if a builder purchase a van for his business (although self employed) then the builder is entitled to claim his AIA of 100% up to the current years threshold on their tax return.

Am I correct in saying that the builder would then not be able to claim the 45p HMRC mileage rate, as this is meant to include depreciation etc and therefore capital allowances?

If so, what about the fuel rate that HMRC provide.  Could the builder continue to claim fuel at the prevailing rate, eg 15p or 18p depending on engine size and fuel type?  Or is this exclusively for company car users?

If the 45p is not allowed because of the CA use, i'm just trying to establish which is the most tax efficient way to do it!

So if the builder does say 45000 miles in the year, they could claim 10000 miles at 45p and 35000 at 25p, so that would go as an allowable deduction of £13250, whereas if the van only cost 8k, then the would only be getting tax relieve on £8000, so the mileage rate would be a better way to calculate it!

Can someone advise if my thinking is correct?

Many thanks


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27th Apr 2013 10:13

Not quite right

In the case of claiming the AIA you will also be able to claim the running costs of the van.  So in year one it would be the AIA of £8,000 plus the actual running costs.  In year two it would only be the running costs.  In the year of disposal it would be the running costs less the disposal proceeds.



Thanks (1)
27th Apr 2013 12:21


As Peter says, you would include all running costs - fuel, insurance, tax, mot, maintenance etc. Add back the proportion of personal use of running costs and AIA if appropriate.

Thanks (1)
29th Apr 2013 11:26

Hi Andy/Peter

Thanks very much for the responses, just to clarify on the fuel element, you say include all running costs, for fuel, is this just at the "cost" ie fuel receipts etc, so they wouldn't use the HMRC rates, it would just be expensed in full and then a deduction made for private mileage within that?

Sounds  a lot better than first thought, thanks for the input!

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29th Apr 2013 11:40

Yes you use the actual fuel receipts used for business or all fuel receipts and add back the non-business proportion.  The same for other running costs.

Just another little pointer if you have private use you will have to depool the van.  (Is that how you spell depool?)

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29th Apr 2013 12:53

Great thanks, and yes, the van would need to be in a separate pool.

Not sure on the spelling or use of "depool" :)

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