Car allowance--Claiming tax back from loan

cambb

Hi,

I recieve an car allowance from work (£6000) a year for opting out of the company car scheme. 3 years ago i took out a £16500 loan to purchase a car. i've been told, not sure if it's correct, that i can claim the interest back from the loan to offset my tax.
Any ideas?

jennifernil

That used to be the case, but I'm not sure you can do that now. Do you actually use your car in the course of your work, or was it just a "perk"? You can claim 40p per mile up to 10000 miles for business use.

cambb

I already claim the mileage allowance, just somebody mentioned about claiming relief for the interest for my loan

billywhizz

I am no expert but AFAIK you could only do that if you were self employed, as an employee you'd have little hope.

Petmidget

I am sorry to say this used to be the case and ceased in 2001/2.

Was part of the "actual method" of working out what mileage you could claim under s249 of Sch E instead of using flat mileage rate.

You could however still make a claim for the interest for 99/00, 00/01 & 01/02 as those periods may still be amended.

Oh !!!!!! just noticed you took out loan 3 years ago, but that would apply to anyone who had a loan a bit older.

PS you cant claim all the interest only the proportion relating to business mileage as claim previously I would assume