Q&A Monday | Season 1 | Episode 4 | Question 1

I’m looking at my business leasing a car, and plan on using it for personal use too. Is there anything I need to be aware of, do differently or record? I currently use my personal vehicle and claim the milage back from the business?

Helen – So, the first thing I would say to truly ask yourself is the vehicle going to be used for the business primarily? If it is, then it could be a benefit to taking a vehicle into the business if it isn’t then you’re probably better off staying at claiming 45p a mile using your private vehicle If you do take a vehicle into the business, at the moment, there are some really good benefits around having an electric car or as low CO2 emissions as possible car.

Those benefits are here for a period of time, however, if you’re then intending to sell that vehicle in say four years time, before it’s run its life the benefits you gain now you will then have to give back an element of that.

A couple of things on the leasing, if you’re VAT registered, you can have options whether it’s a high purchase or a finance lease. You can choose to, in some cases pay and claim the VAT all upfront or you can claim it on a monthly basis as you pay.

Really have a think about why you truly want that vehicle in the business. There are quite a lot of technical elements behind the decision on where it appears in your accounts, how you record it from a tax perspective etc.

Q&A Monday