New car for the self-employed

Domanika

Hello,
I'm self-employed, Usualy I go to the customer's home due to the nature of my work. Currently, my car is broken and We (with my husband) want to buy the new car with the financial plan.
And now my question: can I buy it as a company car and tax deduction, although we will also use it for private purposes in 50%.
thank you for your answer regards

HappyMJ

You would be best speaking to your tax accountant as they would have all your figures and can seee whether it's worth doing or not.

bartnwood

Hello Domanika,

If you use a vehicle for business purposes then you can either claim a mileage allowance for business travel when visiting your clients or you can claim capital allowances and any finance costs associated with the vehicle purchase such as interest on a hire purchase agreement.

You must ensure though that if you are using the vehicle for private use also that only the percentage applicable to business use is claimed for tax purposes.

chrismac1

If you are running a limited company you'll almost always be better off buying it in YOUR name not the company's. Taxable benefit in kind, so tax and employer's NI to pay. Plus potentially extra stuff to file with HMRC so extra chances for them to fine you. All the fun has gone out of this!

nomunnofun

Domanika wrote: »

Hello,
I'm self-employed, Usualy I go to the customer's home due to the nature of my work. Currently, my car is broken and We (with my husband) want to buy the new car with the financial plan.
And now my question: can I buy it as a company car and tax deduction, although we will also use it for private purposes in 50%.
thank you for your answer regards

Are you self employed or are you trading as a limited company?

If self employed, the car is not a 'company car' and chrismac's answer is not relevant. In this case, the car becomes an asset of the business and it qualifies for capital allowances.

If you are indeed trading as a limited company, chrismac's advice applies - but there is a world of difference between the two business models.