Ltd Company - Vehicles
Discussion
Can someone please give me an idiots guide to vehicle purchases for a Ltd company?
I am in need of a new car and as a director of a company I’d like to find the best way to do this.
As I understand it:
1) Buy a personal car, claim back business mileage.
2) Buy a commercial vehicle, pick up, van whatever, and that expense and all expenses got through the company (aside from personal use?)
I thought electric vehicles were similar to commercial vehicles in so much as there was no or little tax to pay due to their emissions, have I got that totally wrong?!
Basically, it seems like my only options are the 2 above unless I want to pay a lot in personal tax?
I am in need of a new car and as a director of a company I’d like to find the best way to do this.
As I understand it:
1) Buy a personal car, claim back business mileage.
2) Buy a commercial vehicle, pick up, van whatever, and that expense and all expenses got through the company (aside from personal use?)
I thought electric vehicles were similar to commercial vehicles in so much as there was no or little tax to pay due to their emissions, have I got that totally wrong?!
Basically, it seems like my only options are the 2 above unless I want to pay a lot in personal tax?
Probably a bit late for the OP, but your accountant will do be able to give you specific advice related to your accounts.
However, in general it is not tax efficient to run a company car via a limited company.
I run a commercial vehicle (VW Amarok) via my ltd company and all costs go through the company, including personal mileage, of which i pay about a grand a year personal tax (Can't remember the exact figure). Where i live and work in Aberdeen, is crawling with contractors driving trucks!
From April 6th next year, BIK for BEV's (Battery Electric Vehicles) will drop to 0%, so i will chop my truck in for something like an i-pace or even a Taycan and pay zero BIK for the first year, going up 1% the next year, then 2% the year after that. Happy days, however things like depreciation need to be taken into account and also the most tax efficient way to pay for the vehicle from your company.
However, in general it is not tax efficient to run a company car via a limited company.
I run a commercial vehicle (VW Amarok) via my ltd company and all costs go through the company, including personal mileage, of which i pay about a grand a year personal tax (Can't remember the exact figure). Where i live and work in Aberdeen, is crawling with contractors driving trucks!
From April 6th next year, BIK for BEV's (Battery Electric Vehicles) will drop to 0%, so i will chop my truck in for something like an i-pace or even a Taycan and pay zero BIK for the first year, going up 1% the next year, then 2% the year after that. Happy days, however things like depreciation need to be taken into account and also the most tax efficient way to pay for the vehicle from your company.
rufmeister said:
Can someone please give me an idiots guide to vehicle purchases for a Ltd company?
I am in need of a new car and as a director of a company I’d like to find the best way to do this.
As I understand it:
1) Buy a personal car, claim back business mileage.
2) Buy a commercial vehicle, pick up, van whatever, and that expense and all expenses got through the company (aside from personal use?)
I thought electric vehicles were similar to commercial vehicles in so much as there was no or little tax to pay due to their emissions, have I got that totally wrong?!
Basically, it seems like my only options are the 2 above unless I want to pay a lot in personal tax?
What mileage are you doing?I am in need of a new car and as a director of a company I’d like to find the best way to do this.
As I understand it:
1) Buy a personal car, claim back business mileage.
2) Buy a commercial vehicle, pick up, van whatever, and that expense and all expenses got through the company (aside from personal use?)
I thought electric vehicles were similar to commercial vehicles in so much as there was no or little tax to pay due to their emissions, have I got that totally wrong?!
Basically, it seems like my only options are the 2 above unless I want to pay a lot in personal tax?
If not much it's probably cheaper to buy personally and claim mileage to avoid CCT.
Guffy said:
Probably a bit late for the OP, but your accountant will do be able to give you specific advice related to your accounts.
However, in general it is not tax efficient to run a company car via a limited company.
I run a commercial vehicle (VW Amarok) via my ltd company and all costs go through the company, including personal mileage, of which i pay about a grand a year personal tax (Can't remember the exact figure). Where i live and work in Aberdeen, is crawling with contractors driving trucks!
From April 6th next year, BIK for BEV's (Battery Electric Vehicles) will drop to 0%, so i will chop my truck in for something like an i-pace or even a Taycan and pay zero BIK for the first year, going up 1% the next year, then 2% the year after that. Happy days, however things like depreciation need to be taken into account and also the most tax efficient way to pay for the vehicle from your company.
Also it's worth looking at some of the plug in hybrids as the tax rate goes down for some of them too.However, in general it is not tax efficient to run a company car via a limited company.
I run a commercial vehicle (VW Amarok) via my ltd company and all costs go through the company, including personal mileage, of which i pay about a grand a year personal tax (Can't remember the exact figure). Where i live and work in Aberdeen, is crawling with contractors driving trucks!
From April 6th next year, BIK for BEV's (Battery Electric Vehicles) will drop to 0%, so i will chop my truck in for something like an i-pace or even a Taycan and pay zero BIK for the first year, going up 1% the next year, then 2% the year after that. Happy days, however things like depreciation need to be taken into account and also the most tax efficient way to pay for the vehicle from your company.
I noticed for example the new BMW X5 45e is under 50 g/km and has a 50 mile range on electric, according to com car website it would only be 8% BIK as of April 2020, so only about 3k tax including personal fuel as a higher rate taxpayer. The 3.0 diesel is closer to £15k!!
rufmeister said:
Thanks for the replies.
Doing around 15k p/a business miles.
Looked at commercial vehicle but just couldn’t go down the pick up route, so opted for a personal vehicle and charge the company mileage.
Very probably the right choice! I run a commercial vehicle (Ford Ranger) through my company. I bought and am living in a renovation project and I have large dogs so a pick up really does suit my needs right now and it is of course tax efficient. I do like the pick up...….until I get back in a car and then am reminded how noisy, slow and that you have to think a bit more carefully about where you park. If it wasn't useful for my needs out of work, I'd be reluctant to get one even if it does offer some tax advantages.Doing around 15k p/a business miles.
Looked at commercial vehicle but just couldn’t go down the pick up route, so opted for a personal vehicle and charge the company mileage.
Autopilot said:
Very probably the right choice! I run a commercial vehicle (Ford Ranger) through my company. I bought and am living in a renovation project and I have large dogs so a pick up really does suit my needs right now and it is of course tax efficient. I do like the pick up...….until I get back in a car and then am reminded how noisy, slow and that you have to think a bit more carefully about where you park. If it wasn't useful for my needs out of work, I'd be reluctant to get one even if it does offer some tax advantages.
They certainly aren't car like are they?I don't feel the need to "get one over the tax man" that much that I could drive one for 2-3 years minimum.
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