Ltd Co Question

MickKnipfler

I work through my own Ltd Co doing short term contract freelance work. The client's offices are 100 miles from my home (Ltd Co Office). I currently have a privately owned campervan that I station near to the clietn as a temporary office and tend to stay there 2-3 nights a week and work from there on and off during the week when not at the cliebnts office.

My questions are:

1) Could my Ltd Co buy a caraven for this purpose rather than using my own camper? (I know that I wouldn't be able to use it privately).
2) A decent caravan could not be towed by my own car. Would that give me a legitimate reason to have a pick-up truck as a company vehicle?
3) If the answers to 1&2 are yes, would I then have to use the company vehicle for all company mileage or could I still use my private car and pay the 40p/25p when I don't need to tow the caravan?
4) What mileage rate could my company pay for the pick-up when used on company business if I was paying for the diesel?


Thanks

linlin_3

1) Could my Ltd Co buy a caraven for this purpose rather than using my own camper? (I know that I wouldn't be able to use it privately).
Yes - your Ltd Co could buy a caravan; or you could sell your camper to the Ltd Co via your Directors Loan Account. Any private use would be reflected as private use of a company asset and would be shown on your P11D.
2) A decent caravan could not be towed by my own car. Would that give me a legitimate reason to have a pick-up truck as a company vehicle?
Yes - but you would need to show that it is for company use - see conditions re private use above.
3) If the answers to 1&2 are yes, would I then have to use the company vehicle for all company mileage or could I still use my private car and pay the 40p/25p when I don't need to tow the caravan?
I don't see why not, costs for the company vehicle would be that much lower.
4) What mileage rate could my company pay for the pick-up when used on company business if I was paying for the diesel?
They may be the same rates as for cars e.g. 40/25p, but you'd need to confirm that. If the pick-up is classed as a commercial vehicle - look very carefully into the details of this one - it's a whole different ball game to non commercial vehicles.
A commercial vehicle used to be classed as no rear windows.
If you do go ahead and buy, consider registering for VAT to claim back the VAT, and...the best time to buy is just before your financial year end as you'll get capital allowances for the whole year. Make sure you take actual delivery of the caravan/vehicle prior to year end.
Happy camping!

hopon

linlin wrote: »

4) What mileage rate could my company pay for the pick-up when used on company business if I was paying for the diesel?
They may be the same rates as for cars e.g. 40/25p, but you'd need to confirm that.

If it's a company owned vehicle then the fuel only rates are:

Engine size Petrol Diesel LPG
1,400cc or less 9 pence per mile 9 pence per mile 6 pence per mile
1,400 - 2000cc 11 pence per mile 9 pence per mile 7 pence per mile
2000CC + 16 pence per mile 12 pence per mile10 pence per mile

MickKnipfler

Thanks for that.

1) How would BIK be calculated if I did use the caravan privately?
2) The truck would be used for company business as a means of towing the caravan about. If I took it as a company vehicle, the P11D liability is a lot lower than a car.
4) It would be a commercial vehicle (hence the low P11D liability). I thought 40/25p was for use of a private vehicle, surely that wouldn't apply to a company supplied vehicle?

I need to register for VAT anyway so will make sure I do this first (I'm registering for flat rate).
I don't understand the comment about buying at the end of the year??

MickKnipfler

Thanks hopon, are the 16p 12p and 10p changed at various mileage points?

linlin_3

MickKnipfler wrote: »

I don't understand the comment about buying at the end of the year??

Not the calendar year, the end of your financial year. You don't part with your cash until the last moment, but you'll get capital allowances for a full twelve months, thus reducing your tax bill.

Check on FYA - First Year Allowances before buying. If they're 25% one year but going to 75% the following year, it could be worth waiting.

Check also on what is now considered to be "expensive" - it used to be £12K - you can only get capital allowances up to that amount.

Check, check and double check, specifications for commercial vehicle by Mr VATman

MickKnipfler

I'll check that out as I still don't understand. Are you saying it reduces corporation tax liability?