cheeky question - claiming car as expense

martnava

Hi,
i am self employed. i work from home. being self employed, i have come to realise that the self employed are somewhat heavily (and unfairly?) taxed.

I was wondering if i can claim all or say 50% of my car costs as an expense to reduce my annual taxable income?

For example, fuel costs, road tax, insurance, mot and other misc car running costs?

I know that i work from home but technically, i use the car to get home (to get to my place of work) every day.

I wouldnt normally ask but the tax man has recently been a bit unfair to me and i wanna get my own back.

Thanks in advance for any advice,
Martin.

fengirl_2

Self employed people are not any more heavily taxed than anyone else - they pay the same rate of tax as PAYE people but have the advantage that they don't have to pay at source and can write off many more expenses against tax.
If you use your car for business then of course you have to include its running costs in your accounts. Maybe the taxman has been 'unfair' because you don't have good enough records? You need to include all your vehicle running costs in your accounts and then add back the private proportion in your tax return at the end of the year. The private proportion depends on what private use you actually get from the car - keep records for 3 mths or so to enable you to make a fair estimate.
The taxman is only an agent of the state - dont take it personally.

CLAPTON

If the tax man has been unfair to you why not share the situation here. Maybe someone will suggest a way you can challenge the decision.

Poppy9

You can only claim for your car if you are using it in the course of your business.

As previously stated SE pay tax at the same rate as PAYE but you can claim for expenses like a proportion of your home utility bills etc. even if it's not your normal work place but if you do paperwork etc. at home.

martnava

Hi,
thanks for the advice

When i say heavily taxed i am slightly mis-quoting myself. What i actually mean is with regards to class 4 national insurance contributions, i think these are a little mean especially as mine is only a small business but anyways, this is a different topic.

With regards to being unfair, well i had this situation, i paid all my taxes as requested on my self assessment. The tax man then refunded about 700 quid for some unknown reason. The taxman then said that i had underpaid by 700 quid and charged me interest of about 100 quid on this. I was not informed on any statements or was not sent any demands or notifications that i owed anything until i received a final demand (one of those red ones).

I paid all money owing immediately including interest (to stop additional interest accruing). I then sent a letter to the taxman saying that it is unfair to charge me interest as i already paid the money owned (which was subsequently refunded) and also, as i had no way of knowing i owed anything as i was not informed. My last self assessment statement said i had nothing to pay so i was confused when i recieve a final demand :S

They replied to my letter stating what they had previously stated, that i had underpaid and had to pay the interest. I mean, i am trying to pay what i owe but i cant do that if they dont tell me that i owe something and then send me a statement saying in black and white that i dont owe anything!

Not to mention, the self assessment form online was ridiculously buggy grrr it would have been easier and quicker to do a paper one (i get the short version).

And they say that tax doesnt have to be taxing !

Anyways, any suggestions welcome, thanks,
Martin.

dmg24

martnava wrote: »

I know that i work from home but technically, i use the car to get home (to get to my place of work) every day.

Can you elaborate on this? Do you actually use your car in the course of your business, because I don't understand how you would need one to get from A to A?

martnava

hehe, well i dont really i'm just peaved at the tax man. Chargin me interest for money i had already paid. I'm guessing if i pursue the matter legally, its gonna cost me more in solicitors fees than the 100 quid interest so i'm looking for any loophole or legal measure that i can take to reduce my taxable income.

technically, i work from home. i use the car to get home every day. this means that i use my car to get to my place of work every day no? :P

Martin.

Robertf

I think you are asking for trouble to try to claim your car to get to your home, presumably where you are already. If you do any business miles - say to go to the postoffice, to do your banking, to buy stock or equipment, you could claim for your mileage - I think the accepted rate is 38p a mile, but you can check on the HMRC website

johnllew

martnava wrote: »

i work from home. i use the car to get home every day. this means that i use my car to get to my place of work every day no?

You're right: no.

martnava

hi, okies, what bout the interest that they charged me, any advice on that?
Thanks,
Martin :P

Ste_C

If you weren't expecting a refund, why didn't you query it with HMRC? Did you just bank the cheque and spend it without wondering what was for?

They do make mistakes allocating payments sometimes so it's wise to keep track of your account online.