Self assessment and a lease car?

Krakkkers

I am a sole trader with a small ebay business turning over maybe £750 - £1000 a month.
I need a new car which would be for personal and business use and am looking at leasing a car for the first time.
I only do around 1100 miles a year for business and have claimed the simple mileage allowance on my latest self assessment 24/25 but if i lease a car can i claim any of that monthly lease on my next self assessment and if so what part of the self assessment is that claim made on?
Thanks in advance. 

mybestattempt

Krakkkers said:

I am a sole trader with a small ebay business turning over maybe £750 - £1000 a month.
I need a new car which would be for personal and business use and am looking at leasing a car for the first time.
I only do around 1100 miles a year for business and have claimed the simple mileage allowance on my latest self assessment 24/25 but if i lease a car can i claim any of that monthly lease on my next self assessment and if so what part of the self assessment is that claim made on?
Thanks in advance. 

The car leasing costs cannot be claimed in addition to a simplified mileage claim:

https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim75005

 

MyRealNameToo

Krakkkers said:

I am a sole trader with a small ebay business turning over maybe £750 - £1000 a month.
I need a new car which would be for personal and business use and am looking at leasing a car for the first time.
I only do around 1100 miles a year for business and have claimed the simple mileage allowance on my latest self assessment 24/25 but if i lease a car can i claim any of that monthly lease on my next self assessment and if so what part of the self assessment is that claim made on?
Thanks in advance. 

You would claim the proportion that is business use. So have a 10,000 mile a year lease and do 1,000 miles for business you claim 10% of it but that would instead of the simplified mileage system.

Krakkkers

Ok, so i am looking at 5000 miles a year on a lease and do 1000 on business, if the lease is 375 a month then i can claim 75 against tax? I think i have to knock off another 15% because it would not be an electric car.
Do i still do a personal rather that business lease? and i assume i can still claim for fuel but not through the simple mileage way.
I am retired and most of my income comes from my company pensions, is there a minimum amount you have to earn from being a sole trader to be able to do this?

Isthisforreal99

Krakkkers said:

Ok, so i am looking at 5000 miles a year on a lease and do 1000 on business, if the lease is 375 a month then i can claim 75 against tax? I think i have to knock off another 15% because it would not be an electric car.
Do i still do a personal rather that business lease? and i assume i can still claim for fuel but not through the simple mileage way.
I am retired and most of my income comes from my company pensions, is there a minimum amount you have to earn from being a sole trader to be able to do this?

Does the £375 pm include VAT?

Krakkkers

Isthisforreal99 said:

Does the £375 pm include VAT?

Yes, it is for a personal lease inc VAT

Veteransaver

Is it worth setting up as a limited company and then providing yourself with an electric car at low BIK rates?

Jeremy535897

You can choose either the simplified claim for mileage, or claim the business proportion (say 80%) of all car expenses (lease costs, fuel, repairs, road fund licence, insurance and vehicle recovery). Be aware HMRC may demand to see proper mileage records to prove the business proportion. You must disallow 15% of your lease costs if the vehicle CO2 emissions are more than 50g/km, so you would claim 80% of 85%.

Krakkkers

Thanks, do my profits or turnover need to be at a certain level to be able to claim for a portion of my car lease?

The lease would be around 375 a month and 20% of the mileage would be business then lose 15% so i would be claiming around 60 pounds a month tax relief.

Isthisforreal99

Krakkkers said:

Thanks, do my profits or turnover need to be at a certain level to be able to claim for a portion of my car lease?

The lease would be around 375 a month and 20% of the mileage would be business then lose 15% so i would be claiming around 60 pounds a month tax relief.

You also can't claim 100% of the VAT element of the lease.

As an aside, paying £4,500 a year to lease a car to do 5,000 miles per annum isn't the most money saving thing to do.

Krakkkers

Ok so i can only claim my tax relief on the element of the lease payment that does not include VAT.
I am new to this so learning all the time.