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Motorhome in company with no private use

Motorhome in company with no private use

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A limited company clients business involves spending periods of time in the countryside at different locations. They have bought a motorhome to stay in whilst working. I've told them a motorhome is classed as a car and may give rise to a BIK, but they've said there will be no private use. 

Can anyone suggest a way to prove that there's no private use if HMRC come calling? I was going to suggest a detailed mileage/date log explaining what they were working on at any time, but I can't think of anything else. The clients are a couple who are the only people involved in the company so I don't know if there can be a contract between them and the company restricting the use of the motorhome to business use only?

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By Pygmy
10th Aug 2018 15:48

Two additional problems spring to mind.

1. You appear to be able to enjoy private use of a motorhome whilst it is parked up.

2. It may be difficult to argue that there is no private use at all when the motorhome is in a pleasant country location on company business.

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By jcace
10th Aug 2018 16:35

It's not just a question of use, it's a question of whether the car is available for private use.

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Replying to jcace:
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By Adam12345
10th Aug 2018 17:07

I agree. What were they doing without a motorhome? Living in a tent?

If it is available for private use, there is a BIK there. Good luck persuading HMRC it is not available for private use.

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By Slim
10th Aug 2018 16:44

What industry are they in?

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Replying to Slim:
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By daviddaniels
10th Aug 2018 16:53

They write and publish specialist walking guides, that's why they have to stay at various locations. Due to the nature of the books, they have to research the areas on foot.

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By WhichTyler
17th Aug 2018 16:40

the specialist walking guide game must be reasonably lucrative. That surprises me...

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Replying to WhichTyler:
RLI
By lionofludesch
18th Aug 2018 10:47

WhichTyler wrote:

the specialist walking guide game must be reasonably lucrative. That surprises me...

I'm surprised that you're surprised.

My dad used to write about walking. He wrote a book with Ian Botham. Well, when I say he wrote a book with Ian Botham, he wrote descriptions of two of the 100 walks and Ian Botham wrote a foreword for the book.

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Hallerud at Easter
By DJKL
10th Aug 2018 17:12

Wonder if HMRC would not mind a tent and a tandem? Given they write walking guides a cycle might be better re access.

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By ValCassidy
17th Aug 2018 10:10

Can they obtain an insurance policy prohibiting private use ?

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Replying to ValCassidy:
RLI
By lionofludesch
18th Aug 2018 10:42

ValCassidy wrote:

Can they obtain an insurance policy prohibiting private use ?

Jeez - that might lead to more problems than a tax bill.

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By scorbett
17th Aug 2018 10:31

Not sure whether the HMRC would accept it, but how about a GPS tracker. Every location the motorhome stayed could then be tracked to their publications for that area?

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By pauljohnston
17th Aug 2018 13:35

Another question may be where is it stored whilst not in use?

I hope away from clients home. Otherwise I think yu will have trouble showing that it is not available for private use.

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By Greenslades
17th Aug 2018 14:16

I can only relate my experience a few year back. I had a large Motor Dealership that was involved in motorsport and brought a large American motor home for the trackside base and the argument about Car BIK followed. There definitely was no private use in the accepted sense. Now this was so large you had to have a HGV driving licence to drive it so it was hardly a car. we eventually had a meet with HMRC and a compromise deal was done where the company paid the BIK tax for the actual days when used at site which on balance the client decided to accept and pay rather than have a protracted dispute

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By Tax Dragon
18th Aug 2018 10:13

OP, I think you have allowed your clients to become confused - possibly because you're confused - by the exemption for travel and subsistence.

Eating, drinking and sleeping are personal (private) functions and having those paid for is a benefit. Sometimes that benefit is not taxed, but it doesn't stop them being private functions.

In short, buying a motor home was stupid if there's going to be no private use of it. Rather than waste your time trying to persuade HMRC of something that isn't true, educate your clients better.

There are specific rules for HGVs by the way, so it's possible that Greenslades was hard done by. Don't know - would have to consider further - just saying not to read too much into that precedent.

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Replying to Tax Dragon:
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By Tax Dragon
18th Aug 2018 10:37

But there would be no harm taking the initiative and seeing whether HMRC would accept a reduced BIK in the circumstances. (Wait for them to pick it up and such an outcome seems less likely.)

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