My client is claiming capital allowances on a car for her sole trader business. She estimates that 95% of mileage is business and 5% is personal. Would she need to keep detailed mileage records for every journey to back up the split or is it enough for HMRC to keep a note of private miles and total mileage in the year to adjust for the private element? Thanks.
Related resources
Replies (11)
Please login or register to join the discussion.
"is it enough for HMRC to keep a note of private miles and total mileage in the year to adjust for the private element?"
No ... think about your basic maths.
If, say, "client's note of private miles is 1,500" and "total mileage in year is 30,000", then you are saying therefore 28,500 must be business mileage?
But some of those 28,500 miles may have 'accidently' been omitted from client's record of private miles (or be something else entirely such as when it was borrowed by a relative whilst client was on holiday) ... which is the type of (cynical) suspicion likely to be held by HMRC.
And if your client has no record of the actual business miles, then how will HMRC's suspicions be allayed?
HMRC will never ask her to prove her private mileage.
They might ask about business mileage.
Damn, Hugo, you really do type faster than me. We've made basically the same point, you much more slowly in terms of number of words. But still you're a minute quicker.
Are you still uni-digital?!
Still unidextrous (for typing although light activity is viable with both hands).
Slightly more multi-digital than before (if only to prevent the incipient RSI that was threatening my left-hand index finger) ... but a curious crab-like wandering across the keyboard by 2, occasionally 3, fingers - ably supported by the thumb.
They told me 2 years for full recovery (or rather that improvement would cease after 2 years irrespective of the degree of recovery fullness), so there's still 18 months for me to invent some brand new interaction methodologies with my keyboard!
EDIT: I've just realised that my initial adjuration to OP ("think about your basic maths") should really have referred more specifically to your (favourite?) topic of set theory - Venn diagrams would illustrate the issue in fewer words than I used.
"Wholly and exclusively" almost explicitly excludes a Venn diagram, I'd've thought.
Talking of which... OP, are you happy with the estimate?
Yeah, flippancy will always trip me up!
You can get there via a Venn diagram, but on thinking about it you'd probably end up confusing the issue for most people.
It starts as a simple Set (private mileage) which is a subset of the Superset (total mileage) - and then you have to introduce the concept of the Set being ill-defined (like a slightly inflating/deflating balloon that emulates a beating heart).
Since the Superset is well defined, this leaves the delta value (Superset minus Set) as a fuzzy number of items ... for which I suspect there's a quantum probability - but whether or not I've disappeared up a dead-end, it's unlikely to generate any value that HMRC will accept!
I should have stuck to words ... all of which could indeed have been encapsulated by saying to OP: "How would your client demonstrate 'wholly and exclusively' to HMRC if asked to do so?"!
I dislocated my elbow and fractured my radial head in 1993. I managed to type even with my plaster on as they broke the plaster around my wrist so that my elbow joint didn't seize up. I had to keep squeezing a squash ball as part of my physio, I was told 2 years too but it didn't take that long.
I still have limited movement in my wrist-thinking doors are locked, when they aren't but it isn't that limited.
Thanks for the positive thoughts, but for the first 4 months I was forbidden from using my right hand for anything that might have been detectable in the right upper arm and shoulder ... hence no typing with it.
At the risk of sounding competitive(!), I managed to do rather more damage than a 'mere' fracture ... the badly named humerus fully detached from my upper arm and then split itself into 3 discrete 'floating' chunks of bone. The options on offer were lengthy surgery for a full reconstruction (including the rest of the shoulder structure); or no direct intervention (a combination of using gravity to 'pull' it all in one direction whilst keeping the upper arm immobile). The former was decided to be 'too dangerous', so the long slow route was selected!
Nevertheless it's not in my nature to be defeated, so I keep finding new ways to get things done (including the left hand crab-like scuttle across a keyboard).
When I first set up in business, I had a sheet of paper permanently in the car and logged my mileage. I soon got a feel for the % but then I do very little business mileage. I guess it all depends on big the business is and whether the mileage would stand out like a sore thumb. HMRC don't have the resources to challenge the minutiae.
Agreed- at 95% the business would likely either need to operate from the home address or the vehicle would likely require to be left overnight at the work address. I suppose a service engineer or similar covering a large radius re business call outs could get to 95% but not too many others.
