Capital Allowance Query - Sole Trader Purchasing a Car

3 Posts

in Cutting tax
As the subject line of this thread suggests I am a sole trader and want to ask about how to claim tax relief on the purchase of a vehicle.
I travel a fair bit for work and would say 60-70% of my car use is work related (if it makes any difference I work from home and travel to various places of work, no 'base of operations' save my own home).
I have the most audacious bad luck with buying cars and have already bought and sold/scrapped 3 within a 6 month period - don't even ask how/why, it makes me very sad just thinking about it!
In terms of record keeping:
I keep my 'books' in a spreadsheet in which I record all income and expenses, and this includes the purchase of the numerous cars. It is also something I use to reconcile with my bank statements since I have a bank account for the business. However some of the money I spent on the cars came from other bank accounts, and so I also record items spent from 'cash', and my 'personal bank account'. I keep another column in the spreadsheet showing the value of any 'assets' I have, which is really just the car, I don't use any other equipment for my job, and it seems weird to me to show these 'assets' just appearing in that column, with no expenditure elsewhere in the spreadsheet to show where they came from, if that makes sense?
I've got it so the spreadsheet essentially works out what percentage of my vehicle use is a 'work' cost (based on the 60-70% work use, which I calculate based on a record of my mileage) but the spreadsheet is also calculating a proportion of the cost of the vehicles as a business expense because I'm recording the outlay for them in the same column as I'd record the cost of maintenance or fuel etc. The upshot of this is the spreadsheet shows I'm making a loss in each month that I bought a car, which obviously isn't reflective of my actual taxable income.
However, rather than write off the cost of the cars outright, i.e. just remove them from the calculation altogether, I'd like to know what proportion (if any) of the cost of the car(s) can become a tax deduction via the capital allowance system because I can probably re-jig the spreadsheet to calculate that.
For clarity; up to now I've been claiming vehicle expenses on a mileage basis, but I'm aware that can be changed upon the purchase of a different vehicle.
The cars I've bought are older and aren't low emission (over 50g/km CO2) etc - hence the fact they keep breaking down - it's a false economy to buy older cheaper cars I know. but I'm just an idiot when it comes to buying cars!
As a summary of the above, what I would like to know is how to properly record the purchase of a vehicle in my profit / loss spreadsheet (which also double as a banking balance sheet) whilst also working out what capital allowance I can claim on the vehicle, and if there's any support on how to work that out based on the above info I'd greatly appreciate being signposted.
I hope I've been clear with my question! Any help would be appreciated.
I travel a fair bit for work and would say 60-70% of my car use is work related (if it makes any difference I work from home and travel to various places of work, no 'base of operations' save my own home).
I have the most audacious bad luck with buying cars and have already bought and sold/scrapped 3 within a 6 month period - don't even ask how/why, it makes me very sad just thinking about it!

In terms of record keeping:
I keep my 'books' in a spreadsheet in which I record all income and expenses, and this includes the purchase of the numerous cars. It is also something I use to reconcile with my bank statements since I have a bank account for the business. However some of the money I spent on the cars came from other bank accounts, and so I also record items spent from 'cash', and my 'personal bank account'. I keep another column in the spreadsheet showing the value of any 'assets' I have, which is really just the car, I don't use any other equipment for my job, and it seems weird to me to show these 'assets' just appearing in that column, with no expenditure elsewhere in the spreadsheet to show where they came from, if that makes sense?
I've got it so the spreadsheet essentially works out what percentage of my vehicle use is a 'work' cost (based on the 60-70% work use, which I calculate based on a record of my mileage) but the spreadsheet is also calculating a proportion of the cost of the vehicles as a business expense because I'm recording the outlay for them in the same column as I'd record the cost of maintenance or fuel etc. The upshot of this is the spreadsheet shows I'm making a loss in each month that I bought a car, which obviously isn't reflective of my actual taxable income.
However, rather than write off the cost of the cars outright, i.e. just remove them from the calculation altogether, I'd like to know what proportion (if any) of the cost of the car(s) can become a tax deduction via the capital allowance system because I can probably re-jig the spreadsheet to calculate that.
For clarity; up to now I've been claiming vehicle expenses on a mileage basis, but I'm aware that can be changed upon the purchase of a different vehicle.
The cars I've bought are older and aren't low emission (over 50g/km CO2) etc - hence the fact they keep breaking down - it's a false economy to buy older cheaper cars I know. but I'm just an idiot when it comes to buying cars!
As a summary of the above, what I would like to know is how to properly record the purchase of a vehicle in my profit / loss spreadsheet (which also double as a banking balance sheet) whilst also working out what capital allowance I can claim on the vehicle, and if there's any support on how to work that out based on the above info I'd greatly appreciate being signposted.
I hope I've been clear with my question! Any help would be appreciated.
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https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1062497/sa103s-2022.pdf
(Ha sido divertido)
https://www.gov.uk/capital-allowances/business-cars
(Ha sido divertido)