Self Employed Expenses

nwilson92

Hi,

I've been self employed for 2 years and this coming January I'll be doing my SA myself.

I know what I can/can't claim on I'm just not 100% on how it works.

The way (I think) it works is by working out my percentage of works miles compared to private to work out the rest.

So, let's say my work miles are 40% of my annual miles do I apply this 40% to my Insurance, MOT, Tax, maintenance of the car?

So, 40% of all my car costs are possible to claim?

Is this correct or wrong in anyway?


Also, if the 40% is correct do I need to work out how many miles I've done and claim 40p (up to 10,000 miles) for that to fulfil the 40% of car claims?

Thanks in advanced!

zygurat789

nwilson92 wrote: »

Hi,

I've been self employed for 2 years and this coming January I'll be doing my SA myself.

I know what I can/can't claim on I'm just not 100% on how it works.

The way (I think) it works is by working out my percentage of works miles compared to private to work out the rest.

So, let's say my work miles are 40% of my annual miles do I apply this 40% to my Insurance, MOT, Tax, maintenance of the car?

So, 40% of all my car costs are possible to claim?

Is this correct or wrong in anyway?


Also, if the 40% is correct do I need to work out how many miles I've done and claim 40p (up to 10,000 miles) for that to fulfil the 40% of car claims?

Thanks in advanced!

It is either 40% or 45p per mile but you should to work out the figures to know which it is better for you to claim. Don't forget to include WDA in the percentage calculation or that an accountants fee is also a deductible expense.

Tea_Hee_23

Hi,

@zygurat789 is right, motoring expenses can be claimed at a fixed rate or actual cost, where a proportional expense is derived depending on the amount of business mileage you do.

There's some information on this on the link below.

http://www.accountsresource.co.uk/motor-expenses-claim-self-employed/

purdyoaten

If not going down the 45p per mile route you can, as zygurat suggests, claim writing down allowance on your car. To do so you will require a copy of the last income tax and capital allowances computation from your accountant in order to establish the values at the end of your last accounting period.

Pennywise

Just to add..

You can't swap and change which basis you use. It has to be the same basis year after year whilst you own the same car. You can change when you change your car.

And

If you're using the new "simplified cash basis", the only option is the 45p per mile - you can't use the percentage method on this basis.

nwilson92

Thans for your help.

The problem I have is I can't get hold of my accountant hence doing it myself so will not know what system to claim for my car was used last year.

If I was to use the 45ppm this could easierly go over the actual cost. So once it reaches that cost does it simply end until more costs come in (repairs) or start again at the new tax year?

Caz3121

nwilson92 wrote: »

TIf I was to use the 45ppm this could easierly go over the actual cost.

45p per mile is for the first 10,000 miles then it goes to 25p per mile

purdyoaten

nwilson92 wrote: »

Thans for your help.

The problem I have is I can't get hold of my accountant hence doing it myself so will not know what system to claim for my car was used last year.

If I was to use the 45ppm this could easierly go over the actual cost. So once it reaches that cost does it simply end until more costs come in (repairs) or start again at the new tax year?

That does not become a factor..

nwilson92

Just spoke to HMRC and it looks from my last return that the mileage of 45/25ppm was used.

Is there any online calculators at all? I've had a good Google but nothing.

TheCyclingProgrammer

nwilson92 wrote: »

Thans for your help.

The problem I have is I can't get hold of my accountant hence doing it myself so will not know what system to claim for my car was used last year.

If I was to use the 45ppm this could easierly go over the actual cost. So once it reaches that cost does it simply end until more costs come in (repairs) or start again at the new tax year?

If your actual costs work out to less than 45p/mile for the first £10k miles then its clear that you should choose the fixed rate as it works in your favour. The rate is designed to factor in all costs that would normally be allowable...fuel, wear and tear, repairs etc. without having to break it all down and apportion.

sheramber

all you need to do is work out your business mileage and charge the first 10,000 miles at 45p and the rest at 25p.

so if you had 15,000 business miles you have 10,000 @ 45p and 5,000 @25p