Tax relief on Electric Van

Cubana48

Hi guys

I am a sole trader carpenter.  Not VAT registered.  

I am going to get myself an electric van. So many reasons to do it right now.

But I need to know what is the best option for tax relief in this current tax year, as i know the rules have changed. Here are my two options as I understand it. Both of which are based over a 3yr period:

Option 1: Buy a very good condition used van for £11500. Question: Can i claim this in one lump sum, or is it staged, and can I also claim 45p per mile relief? I do approx 7000 business miles per year, so £3150 * 3. So does that mean I can claim relief on £11500 + (3 x £3150) = £20950

Option 2: PCP deal, whereby I stump up a deposit upfront (say £10k), and then make 40 monthly payments of £414. So approx £26560 in total + same mileage as above. £9450 + £26560 = £36010.

So if I am understanding this correctly, it would be much better financially for me to Personal Contract Purchase a new van?

Thanks

sheramber

You would be better posting in the cutting tax forum

Grumpy_chap

You can not claim the van as a business cost and claim the full mileage rate in addition without creating a tax liability.  

If you claim the van as a business cost, there is a reduced mileage rate that can be claimed, assume that the cost of energy was not already paid by the business.

You will get better advice in the tax cutting forum.