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Tax deductible fuel

Tax deductible fuel for client provided car

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If the client provides a lease hired company car to a subcontractor and the subcontractor is responsible for providing fuel and contributes partly to the car hire cost, can the proportion of the subbie's costs used for business trips be tax deductible?

My thoughts are:  There is no BIK tax as the sub is not an employee; the business proportion of the fuel is tax deductible ( meets wholly and exclusively rule); a business proportion of the car hire cost is also tax deductible.

Any thoughts?

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17th Sep 2016 23:09

My thoughts are that you have many misunderstandings.

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to cheekychappy
17th Sep 2016 23:24

Forgot to say....I am looking at it from the subbie's angle.

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18th Sep 2016 08:50

But what cost, apart from fuel, does the subcontractor incur in relation to business use?

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to johngroganjga
18th Sep 2016 09:35

Just fuel and payment towards the monthly lease hire cost.

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to getting old
18th Sep 2016 09:52

But the payment towards the hire cost will be for the private use surely. Plainly not wholly and exclusively for the business.

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to johngroganjga
18th Sep 2016 11:26

Thank you Johngroganjga. That is an interesting thought. The payment towards the hire cost is defined as "use of company car", not for just the private use. Previously the subbie has had to use his own car, so I deemed the car contribution payment as a car hire cost, in which case he could claim the business element. However, I also agree with you that the payment could be treated as paying for the private element only.... So I am still lost.

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to getting old
18th Sep 2016 13:58

What would be the logic in the subcontractor being required to pay to be allowed to drive the company's car for the purposes of the company's business?

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to johngroganjga
18th Sep 2016 19:45

The company car was offered as it is newer alternative.

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to getting old
19th Sep 2016 09:06

That does not answer the question. What would be the logic in the subcontractor paying to be allowed to drive the company's car while working on the company's business.

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to johngroganjga
18th Sep 2016 20:01

The company car was offered as it is newer alternative.

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By pacta
18th Sep 2016 21:33

Is the subbie trading as a ltd co or unincorporated?

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to pacta
18th Sep 2016 22:08

Quote:

Is the subbie trading as a ltd co or unincorporated?

Finally, someone has asked a good question amongst John's whining.

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to pacta
19th Sep 2016 08:52

Soletrader

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19th Sep 2016 09:23

Whilst not your concern, there is a distinct muddying of the waters here, surely, whereby the "engager" provides the sub-contractor (the "engaged") with a means of transport. This provision of transport dilutes the argument for self-employment and could cause your client's engager with complications which could surely be avoided?
Presumably the car will be hired for a contract period, say longer than a month or two?
As I say, not really your problem but, in the longer term, your client could be looking for work elsewhere.

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19th Sep 2016 10:14

Anonymous OP + reply on post = Getting old.

People really are daft.

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to JCresswellTax
19th Sep 2016 11:40

Is attacking people really necessary? I could not reply using the same anonymous op as I was using a different device.... No need to be personal.

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to getting old
19th Sep 2016 12:57

Quote:

Is attacking people really necessary? I could not reply using the same anonymous op as I was using a different device.... No need to be personal.

Aw so if you used the same device you could continue to post as anonymous could you?

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to getting old
20th Sep 2016 11:21

Why post anonymously in the first place? Were you afraid we would be able to identify the client from the mass of information you gave us?

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By birdman
20th Sep 2016 11:28

Surely the purpose of the subbie paying for the use of the Company car whilst carrying out work for the main Contractor is precisely to differentiate from the employee-employer relationship they are trying to avoid?
The Contractor is leasing the car to the subbie, so the subbie's costs are treated exactly as if he was leasing it from elsewhere.
How the insurance cover is arranged, and whether sub-leasing is in breach of the lease terms, are separate matters!

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to birdman
20th Sep 2016 11:54

That would make sense - provided the subcontractor is still charging the company the same amounts as if he were using his own car.

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to birdman
20th Sep 2016 11:54

Quote:

Surely the purpose of the subbie paying for the use of the Company car whilst carrying out work for the main Contractor is precisely to differentiate from the employee-employer relationship they are trying to avoid?
The Contractor is leasing the car to the subbie, so the subbie's costs are treated exactly as if he was leasing it from elsewhere.
How the insurance cover is arranged, and whether sub-leasing is in breach of the lease terms, are separate matters!

Except, unless the contractor's business already involves the leasing of cars, it doesn't differentiate at all. An employee can be supplied with a car, and said employee can pay a contribution to avoid benefit in kind. The making of payments makes no difference.

So the question still comes back to why the contractor is supplying the car rather than leaving the subcontractor to make their own arrangements. The only thing I could think of is that the subbie will be representing the contractor, and the car has livery to show that. Is that the case here?

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