self employed van tax best way to claim for expenses

[Deleted User]

Mummy007 said:

So actual costs would be saving van invoice on purchase, all fuel receipts, insurance costs, repairs, road tax and breakdown cover, tools receipts, clothing receipts just starting so want to do it correct from day one Thanks

The comparison that was being made was for the van usage only. Tools and clothing (protective) would be claimed in any case.

Pennywise

Only "protective" clothing is allowable, i.e. hig viz jacket, steel toed boots, etc.  "Normal" clothes like jeans and trainers aren't allowable even if they're only ever used when driving.

unholyangel

Just to add, if you claim actual costs then you would need to claim actual costs for future years also (BIM75005). You can only change when the vehicle changes. 

I mention this as while actual costs may benefit him in the first year, it may not do the same in future years. 

[Deleted User]

unholyangel said:

Just to add, if you claim actual costs then you would need to claim actual costs for future years also (BIM75005). You can only change when the vehicle changes. 

I mention this as while actual costs may benefit him in the first year, it may not do the same in future years. 

Yes that was the point that I was making with respect to a) the initial purchase of the van and b) the likelihood that insurance would drop dramatically when he reaches 25.

unholyangel

[Deleted User] said:

unholyangel said:

Just to add, if you claim actual costs then you would need to claim actual costs for future years also (BIM75005). You can only change when the vehicle changes. 

I mention this as while actual costs may benefit him in the first year, it may not do the same in future years. 

Yes that was the point that I was making with respect to a) the initial purchase of the van and b) the likelihood that insurance would drop dramatically when he reaches 25.

Yes, there's also the issue that 100% "work use" may not be 100% business mileage. 

[Deleted User]

unholyangel said:

[Deleted User] said:

unholyangel said:

Just to add, if you claim actual costs then you would need to claim actual costs for future years also (BIM75005). You can only change when the vehicle changes. 

I mention this as while actual costs may benefit him in the first year, it may not do the same in future years. 

Yes that was the point that I was making with respect to a) the initial purchase of the van and b) the likelihood that insurance would drop dramatically when he reaches 25.

Yes, there's also the issue that 100% "work use" may not be 100% business mileage. 

Indeed. I must admit that I have always added back a nominal amount of van expenses, perhaps 5% max while leaving the capital allowances claim intact. The same went for mobile telephone. One of the many advantages  of having worked in HMRC was knowing what inspectors looked for and I well remember when there were is a directive to look at those where there was no private use element. Similarly, rather than claim business use only amount of, say 950, I would claim 1000 and add back 50 in the tax computation. It shows that a private element has at least been considered, whether accurate or not. Anything that prevented further scrutiny, however small, was always worth it in my opinion.

Jeremy535897

[Deleted User] said:

unholyangel said:

[Deleted User] said:

unholyangel said:

Just to add, if you claim actual costs then you would need to claim actual costs for future years also (BIM75005). You can only change when the vehicle changes. 

I mention this as while actual costs may benefit him in the first year, it may not do the same in future years. 

Yes that was the point that I was making with respect to a) the initial purchase of the van and b) the likelihood that insurance would drop dramatically when he reaches 25.

Yes, there's also the issue that 100% "work use" may not be 100% business mileage. 

Indeed. I must admit that I have always added back a nominal amount of van expenses, perhaps 5% max while leaving the capital allowances claim intact. The same went for mobile telephone. One of the many advantages  of having worked in HMRC was knowing what inspectors looked for and I well remember when there were is a directive to look at those where there was no private use element. Similarly, rather than claim business use only amount of, say 950, I would claim 1000 and add back 50 in the tax computation. It shows that a private element has at least been considered, whether accurate or not. Anything that prevented further scrutiny, however small, was always worth it in my opinion.

I deplore add backs as what they basically say is that the accounts are wrong, and therefore meaningless as a business tool. I adjust private proportions in the accounts themselves to give a true profit or loss. As anyone with a turnover under £85,000 just has to put a lump sum for allowable expenses on SA103, a lack of trivial add backs to accounts no longer shows up anyway.

[Deleted User]

Jeremy535897 said:

[Deleted User] said:

unholyangel said:

[Deleted User] said:

unholyangel said:

Just to add, if you claim actual costs then you would need to claim actual costs for future years also (BIM75005). You can only change when the vehicle changes. 

I mention this as while actual costs may benefit him in the first year, it may not do the same in future years. 

Yes that was the point that I was making with respect to a) the initial purchase of the van and b) the likelihood that insurance would drop dramatically when he reaches 25.

Yes, there's also the issue that 100% "work use" may not be 100% business mileage. 

Indeed. I must admit that I have always added back a nominal amount of van expenses, perhaps 5% max while leaving the capital allowances claim intact. The same went for mobile telephone. One of the many advantages  of having worked in HMRC was knowing what inspectors looked for and I well remember when there were is a directive to look at those where there was no private use element. Similarly, rather than claim business use only amount of, say 950, I would claim 1000 and add back 50 in the tax computation. It shows that a private element has at least been considered, whether accurate or not. Anything that prevented further scrutiny, however small, was always worth it in my opinion.

I deplore add backs as what they basically say is that the accounts are wrong, and therefore meaningless as a business tool. I adjust private proportions in the accounts themselves to give a true profit or loss. As anyone with a turnover under £85,000 just has to put a lump sum for allowable expenses on SA103, a lack of trivial add backs to accounts no longer shows up anyway.

Fair enough - good point on the 85000 turnover simplification.