Ltd co & going to buy a car !!
Discussion
Hi All,
I need a business vehicle. I am a a business consultant and trade as a Ltd company.
I want something nice but fairly cheap £3-5k.
The car will be purchased by the company in the compnay name. I guess this cost would go against my profit ?
What will the tax benefit be?
How does the depreciation work against the company ?
Would all running costs go against my profit ?
What else should I think about?
Thanks
IceBoy
I need a business vehicle. I am a a business consultant and trade as a Ltd company.
I want something nice but fairly cheap £3-5k.
The car will be purchased by the company in the compnay name. I guess this cost would go against my profit ?
What will the tax benefit be?
How does the depreciation work against the company ?
Would all running costs go against my profit ?
What else should I think about?
Thanks
IceBoy
Buy it privately and charge the company 40p per mile. Buying through the company and you will have a company car tax liability which is based on a combination of the emissions and the ORIGINAL LIST PRICE (note, not the purchase price) - buying a car worth 3-5k will be very unlikely to allow you to offset enough corporation tax to counter the company car tax that you will have to pay.
Not very exciting but my accountant said:
if you buy a car with 110g/km or less this will enable you to write off the wholecost against tax in the year of purchase by claiming a 100% first year capital allowance. For cars with higher emissions and all used cars, tax relief is limited to a writing down allowance of 20% of the cost, with an upper limit of £3000 where the car costs more than £15000. Cars do not qualify for the new annual investment allowance, which gives immediate tax relief on up to £50000 a year of expenditure on equipment.
From april 2009 the writing down allowance is expected to go down to 10% on cars with co2 emmisions above 160kg/km. This means it will take much longer for a business to receive tax relief on a more polluting car.
if you buy a car with 110g/km or less this will enable you to write off the wholecost against tax in the year of purchase by claiming a 100% first year capital allowance. For cars with higher emissions and all used cars, tax relief is limited to a writing down allowance of 20% of the cost, with an upper limit of £3000 where the car costs more than £15000. Cars do not qualify for the new annual investment allowance, which gives immediate tax relief on up to £50000 a year of expenditure on equipment.
From april 2009 the writing down allowance is expected to go down to 10% on cars with co2 emmisions above 160kg/km. This means it will take much longer for a business to receive tax relief on a more polluting car.
ker but the Company car tax is even worse for a small company.Very hard to prove that this is what is being done.
You are referring to a "pool car" which should be avialable to members of staff etc and be insured through the business and insured for business use only etc.
In a sole director type company it is virtually impossible to satisfy the restricted circumstances applicable to "pool cars".
You are referring to a "pool car" which should be avialable to members of staff etc and be insured through the business and insured for business use only etc.
In a sole director type company it is virtually impossible to satisfy the restricted circumstances applicable to "pool cars".
I had a little Audi A2 on the sub 120g Co2 rule (as it was then). Also I think that only applies to NEW cars or ratrher cars that have only been registered to the manufacturer (demonstrators)?
100% capital allowance year one but if you keep it three years as we did all you really do is help the tax bill Y1.
I have just bought a 3 year old Merc E320 CDI. I will claim my 40p a mile because the company car tax based on the new list price scares me witless!
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