Tax relief on using own car

pramsay13

I am currently self-employed as a sole trader.
I use my own car, probably around 1/2 for work, 1/2 for personal use.
I currently claim 45p per mile when I use it for business use, but I am thinking about getting my logo / contact details on it.
Therefore when I am out and about for personal use I will be advertising my services.
So can I claim tax relief on all vehicle expenses?

InsideInsurance

No, nice try though

chalkie99

Be sure you tell your insurance company if you have signwriting /advertising on your vehicle as it may affect your premium and may well invalidate any claim if they have not been notified.

phill99

Chalkie99 is right. If it has your details on the side, it'll be classed as business use which has implications!

londonTiger

putting signage on a vehicle doesn't give you carte blanche right to claim all costs as expenses.

there are three ways for dealing with this

You personally own the vehicle
1) claim 45p per mile. or:
2) claim a percentage of the costs as business expense based on useage. fuel, insurance, road tax, council permit all expenses based on agreed usage split. e.g. 40% business, 60% personal.

company owns the vehicle
1) you pay £3000 per annum as a benefit in kind and pay for the fuel you use. then all motoring costs are to the company.

densol_2

londonTiger wrote: »

putting signage on a vehicle doesn't give you carte blanche right to claim all costs as expenses.

there are three ways for dealing with this

You personally own the vehicle
1) claim 45p per mile. or:
2) claim a percentage of the costs as business expense based on useage. fuel, insurance, road tax, council permit all expenses based on agreed usage split. e.g. 40% business, 60% personal.

company owns the vehicle
1) you pay £3000 per annum as a benefit in kind and pay for the fuel you use. then all motoring costs are to the company.

Regarding point 2 - as the OP is currently claiming at 45p a mile then he is stuck with that system if he has put in a claim in tax return last year for that vehicle and is stuck until he changes his vehicle and then can choose whatever one he wants as long as the mileage is wholly and exclusively for business ( not private journey with a sign on he he )

The more mileage you do - I think the 45p is better ( especially if you have a cheap high cc car with no finance interest ) as no real capital allowance to claim and no interest as expense. So if you did 10,000 genuine business miles a year that £4500 ( then it drops to 25p a mile )

However if you have a modern car with low cc and relatively high business to private miles as a percent but not high overall like above ( i use a bike rather than car for private journeys ) then the traditional way of - diesel plus insurance- plus servicing plus road tax ( if any on low cc car ) plus repairs plus interest to purchase as an expense % against tax ( ie 70% business / 30% private) plus the same % on the writing down capital allowance ( mine gets in the 18% pool as lower cc ) that can work out better. Its a question of doing that maths