Can I buy a plane through the company?

[obiwonkeyblokey]

I've just finished a PPL and have agreed a price on a small light aircraft which I could use for a samll amount of business use ( 20%). Im almost too embarrassed to ask my accountant if I should buy this through the company or purchase and run it privately?

any ideas? ( I will call him next week when he is back in the office)

>> Edited by obiwonkeyblokey on Tuesday 21st March 14:07

[Eric Mc]

There is a very recent thread where this was covered by me. The previous question was about putting flight training costs through the business but I covered actual aircraft capital and running costs in one of my replies. It was within the last two weeks so a PH search should unearth the thread.

[obiwonkeyblokey]

Thanks eric, I will have a dig around.

regards

[obiwonkeyblokey]

Eric Mc said:

Back on topic - I doubt very much that flight training costs would ever be allowed as a legitimate business cost. However, business related running costs (including Capital Allowances) related to the operation of the aircraft for business purposes would be FULLY allowable. I have a client who actually runs a Piper PA-28 Warrior partly for business and partly for private purposes and there has never been a problem with the tax man in claiming the business related costs. >> Edited by Eric Mc on Sunday 12th March 09:42

Hi Eric, did your client buy his aircraft in his business name? therefore an asset of the business and written back accordingly. Or did he buy it privately and charge the business element to his business.

I am thinking of buying in the company name ( there wont be any VAT, as its a private purchase) add it to the books and then fly both business and private flying. However if its more hassle than its worth, the maybe I should just pay for it privately and then claim back the business air miles

[Eric Mc]

I won't answer your first question initially. Regarding your second point, is your business a limited company or a sole tradership/partnership?

[amcphillips]

Eric,

I'm on the look out for an accountant as I'm just about to set up a limited company. If you're interested in doing my forms, tax, returns etc and can give me some advice then I'd be grateful if you could e-mail me to discuss details. Also, how hard is it for a newly formed, limited company to obtain asset finance of £450,000 on hire purchase if I can put down a deposit of £70,000?

Thanks Andrew

[edc]

Our company owns a boat and has no business interest in marine, shipping or transporting people.

[Eric Mc]

That's nice to know

The tax man is totally disinterested in any asset owned by a company unless

a) the company is claiming Capital Allowances on the asset

b) the company is claiming maintenance, running and finance costs associated with the asset.

c) the company has bought the asset for the use of the company directors or employees, in which case Benefit in Kind issues will be relevant.

d) the company is using the asset to generate income.

e) the company sells the asset and makes a Capital Gain on the disposal.

[obiwonkeyblokey]

Hi Eric.

Ltd Co.

Regards

[srebbe64]

Personally, I'm dead against keeping large / valuable assets in my companies - particularly property and cash. Reason being, if a company gets into trouble those assets are "getatable" by creditors. As such, I ringfence them by either owning them personally or getting an investment company (with no creditors) to own them. It's not particularly Tax friendly but it reduces the risk.

[obiwonkeyblokey]

Thats what I was thinking as well Steve. I thought i might be better off owning it privately, then it becomes a personal asset rather than a business one. However I just wanted to check first that I wasn't missing out on some loophole or benefit that could have reduced the cost of ownership as I am effectively a 100% shareholder in the company I was going to use to purchase it.

[Eric Mc]

I would be inclined to hang on to it as a personal asset and just reimburse yourself trough the company whenever you use it for business trips.

[obiwonkeyblokey]

Thanks guys, Im going that route, now I just need to wait until 6th April to take the dosh out of the business to pay for it ( I think)

[neilcharlton]

dont know if its been mentioned as i've not got time to read all the thread but - buy this months PILOT mag all your questions will be answered .

just about to start a ppl !! yey