Car Lease for a Non VAT LTD Company

Consumers_Revenge_2

Hi all,

Appreciate that this can be a confusing subject, it certainly is for me.

I have just setup my Non VAT LTD Company to carry out IT contract work. I am looking to change my privately owned car.

Can I go for arguments sake and as an example, the deal below for a personal contract lease (as my LTD Company is non VAT so not worth putting against the business?) and claim Business mileage on it (45p)?

Probably looking to do 10k to 15k mileage per year.

http://www.stablevehiclecontracts.co.uk/audi-a4-saloon-1.4-tfsi-sport

Appreciate any thoughts.

bengalknights

You can only claim the mileage back from your company for portion used for business purposes

The lease would have to be against yourself if doing this

motorguy

As above really, the lease would be against yourself and then you'd claim at 45p per mile for business miles.


You'll struggle to get a lease for a brand new limited company anyway. Most places are looking to see at least two years of accounts before they'll consider leasing the business a car.


There are some places who will do it, but they are offering extremely uncompetitive deals, so not worth the bother.

Consumers_Revenge_2

Thank you.

So if I leased the car personally and not via Business, I could still claim the 45p per mile (for business mileage)? Or would I need a PCP plan deal where the car would be registered under my name?

I was thinking that by using a personal lease the car would not be under my name and i would struggle to claim the business mileage?

motorguy

Yes, a personal lease or PCP deal (or any finance deal or cash purchase) would allow you to claim @ 45p per mile.


If the car were a "company vehicle" - ie, the company leased or owned it, then you wouldn't be able to claim the 45p per mile.


I have my own car, my own LTD company and I claim the 45p per mile.


A lease is quite a big commitment for a new LTD company. I'm two years in to IT Contracting and have had very little down time but i'm not sure i'd want to be leasing. Its a commitment to a specific vehicle for a specific time, which I've found probably wouldn't work for me (last contract working from home, current contract working away from home and staying over all week so car lies at the airport)


I'm sure your requirements are different, but its worth pondering.

sunshinetours

Turning it round - if contracting for VAT registered business then why not register for VAT and claim the 50% VAT back monthly.

Do the sums to see if benefit in kind on the car makes it worth it, but worth considering.

Even if car not worth it through the company consider VAT registering on flat rate scheme possibly as this can be a money earner in many cases - get advice

Rain_Shadow

sunshinetours wrote: »

Turning it round - if contracting for VAT registered business then why not register for VAT and claim the 50% VAT back monthly.

Do the sums to see if benefit in kind on the car makes it worth it, but worth considering.

Even if car not worth it through the company consider VAT registering on flat rate scheme possibly as this can be a money earner in many cases - get advice

Just beat me to it.:D

I registered our company for VAT as soon as I formed it because our customers are almost exclusively VAT registered. If you are doing IT consulting I would think it won't take you long to reach the VAT threshold anyway.

I have also looked into running cars through the company. It isn't worth it for us.

If you are running your own car and claiming the 45p from the company then the company could reclaim VAT on the fuel element of the 45p.

rhysadams

If your business is new, you may not be able to get a vehicle lease anyway without a Directors Guarantee or 2 years healthy books behind you.

I'd suggest personal lease and then the 45p a mile back, try and stick with the german manufacturers as their lease deals look better than the other brands.