I have a sole trader client who runs a motor repair and spare parts shop business. He plans to buy, on hire purchase a van or pick up vehicle to use in the business. I assume that he will be able to claim normal capital allowances and running costs, that there will be no personal tax liability, and that he won’t be required to keep a mileage log.
Could anyone confirm whether this correct?
Paul
Related resources
Replies (2)
Please login or register to join the discussion.
Yes and No
Yes - he can claim FYA on the cash price of the van or pick-up at the start of the HP agreement and WDA in subsequent years. If he is VAT registered, he can also reclaim the VAT added to the cash price.
Yes - he can claim all the running costs as a deduction from business profits, subject to a disallowance for private use.
No - there is no personal tax liability. What are you thinking of - company vehicles provided to employees?
No - he is not required to keep a mileage log, but he would be well advised to do so if there is any question of the vehicle being used for private purposes.
