Can I claim for van purchase on self assessment?

pernes

I purchased a van last year for work, I am semi retired only earning approximately £12000- £15000 per year.  Can I claim the purchase price which was £8500 on my self assessment? If so under what section do I put it under? Many thanks 

Jeremy535897

Do you prepare accounts on the cash basis? If so, you treat the business proportion as an expense. If not, you can claim capital allowances on the business proportion. If you need them because you have other income, claim in the annual investment allowance box (box 23 of SA103S).

Grumpy_chap

The OP states they are semi-retired.
Is the OP a sole-trader?

pernes

Thanks . Yes I am the sole trader and accounts are prepared accounts on cash basis. The van is used 80% for business use  and I have no other income. 

[Deleted User]

pernes said:

Thanks . Yes I am the sole trader and accounts are prepared accounts on cash basis. The van is used 80% for business use  and I have no other income. 

Then you claim 80% of the cost of the van as an expense. However, I note that your income is stated to be as low as £12000. Is this turnover before expenses? If so, a claim will have no effect on your tax which will be NIL regardless. You will save some liability to Class 4 NIC though.

Jeremy535897

[Deleted User] said:

pernes said:

Thanks . Yes I am the sole trader and accounts are prepared accounts on cash basis. The van is used 80% for business use  and I have no other income. 

Then you claim 80% of the cost of the van as an expense. However, I note that your income is stated to be as low as £12000. Is this turnover before expenses? If so, a claim will have no effect on your tax which will be NIL regardless. You will save some liability to Class 4 NIC though.

As I noted above, it depends if OP has other taxable income.

[Deleted User]

Jeremy535897 said:

[Deleted User] said:

pernes said:

Thanks . Yes I am the sole trader and accounts are prepared accounts on cash basis. The van is used 80% for business use  and I have no other income. 

Then you claim 80% of the cost of the van as an expense. However, I note that your income is stated to be as low as £12000. Is this turnover before expenses? If so, a claim will have no effect on your tax which will be NIL regardless. You will save some liability to Class 4 NIC though.

As I noted above, it depends if OP has other taxable income.

I know - and I responded to the op confirming that there was no other income.

Jeremy535897

On balance, it might be better for OP to claim business mileage rather than the van as an expense, because if this business ceases when OP does have other income, such as a pension, he may end up paying tax on the sale proceeds.

[Deleted User]

Jeremy535897 said:

On balance, it might be better for OP to claim business mileage rather than the van as an expense, because if this business ceases when OP does have other income, such as a pension, he may end up paying tax on the sale proceeds.

Good point - not much point in bringing an asset into charge having not received any relief on it originally. It could also make the op a taxpayer in the year that the van is sold even if no other income.

pernes

Thanks  your advice, so if I claim mileage does that mean I can’t claim for the purchase of the van? I am not claiming a pension as too young for state pension.

[Deleted User]

pernes said:

Thanks  your advice, so if I claim mileage does that mean I can’t claim for the purchase of the van? I am not claiming a pension as too young for state pension.

That is correct. Claiming for the cost of the van will not be of any benefit if your profit remains below 12570 and 80% of any value of the van, either when sold or you cease trading will be added to your profits in the future.