Year End Return

Righttrack

Hi,
I'm not sure if this is the right section to ask this.
Partner is self employed, I do his books which is easy enough. I have a question about the van he has just bought on HP.
I know that I put an interest invoice through each year but wanted a bit of help with depreciation?
Each year I can claim 25% of the nett value, but do I put an invoice through the expenses or does it get listed somewhere else on the tax return? Just a bit worried how that will effect the profit

Thanks

[Deleted User]

You don't claim depreciation in any circumstance- you claim capital allowances. However, a van can be considered for first year allowances.

https://www.gov.uk/capital-allowances/overview

In simple terms you can claim the FULL cost of the van as a tax deduction. How much did the van cost and what profit has been made excluding this?

By the way - no need to invoice for the HP - just claim it!

Righttrack

Hi,

Thanks for the reply. Full nett cost of the vehicle £15,320. Profit will be around £17,500
So where abouts on the tax return does it go? Surely I don't put it through in standard expenses?

antrobus

Righttrack wrote: »

Hi,

Thanks for the reply. Full nett cost of the vehicle £15,320. Profit will be around £17,500
So where abouts on the tax return does it go? Surely I don't put it through in standard expenses?

No, you don't put it through in standard expenses.

If, for example you were completing the Self-employment (short) form, it would go in 'Tax allowances for vehicles and equipment (capital allowances)' i.e. £15,320 in box 23

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/503322/sa103s-2016.pdf

The question would be whether that is what you should do. The personal allowance is currently £11,000. A taxable profit of £17,500 would mean tax is payable on £6,500. So you don't want to claim more than £6,500; you would just be wasting it. (Depending on partner's overall tax position, of course)

[Deleted User]

As a tribes says claim £6500 - no point in reducing your profit below £11000. (Why I asked my question)

Next year you can claim 18% of £8820

Righttrack

Thanks, I've never used the short form, looks so much quicker than returns I have been doing!
Can I use part of the allowance on this year and then some next year, or can you only claim once?
My concern where it went on the return was that I didn't want it to impact the profit declared for when we come to remortgage next year.

Righttrack

Thanks purdyoaten, Cross posted so you've already answered my question

[Deleted User]

Righttrack wrote: »

Thanks, I've never used the short form, looks so much quicker than returns I have been doing!
Can I use part of the allowance on this year and then some next year, or can you only claim once?
My concern where it went on the return was that I didn't want it to impact the profit declared for when we come to remortgage next year.

Our posts have crossed !

[Deleted User]

[Deleted User] wrote:

Our posts have crossed !

Again!!:rotfl: