claiming 40p per mile

poochunks

hi , im currenlty claiming 40p a mile motoring expenses, i understand this covers fuel, wear and tear , mot and repair bills , i am now considering leasing a new vehicle , does this 40p cover leasing costs too. if so i would obviously be much better off claiming all my expenses back instead of 40p per mile

ManAtHome

Think the only way to effectively claim all your car-related exes is for it to be a company car, then you get hit for income tax...

Are you an employee, self-employed, or (your own) company director?

fengirl_2

You are not limited to claiming 40p per mile - you can opt for the full cost method. You would need to keep all receipts relating to everything you buy for the car - from petrol and oil to lease costs and servicing. You then claim the business proportion of the total cost.
Others on here have said that, with the rising cost of petrol you are better off using this method.

jiggy2

poochunks wrote: »

hi , im currenlty claiming 40p a mile motoring expenses, i understand this covers fuel, wear and tear , mot and repair bills , i am now considering leasing a new vehicle , does this 40p cover leasing costs too. if so i would obviously be much better off claiming all my expenses back instead of 40p per mile

please confirm whether you are employer or self employed...

if self employed and your turnover is > than the VAT registration threshold you can't use the 40p a mile. You would have to use the actual costs method and disallow the proportion that is for private use.

poochunks

im self employed and not vat registered

jiggy2

as you are self employed (and your turnover is less than the VAT threshold) you have two options:

Claim 40p for each business mile you do (upto 10,000 business miles and 25p thereafter) - it includes all costs of the car - a mileage log should be maintained to support the claim on your tax return

Keep a record of all expenses you pay for the car - and then based on the above mileage estimate what your private usage would be - this proportion should be disallwed from the total motor exp cost.

how long is the lease for?

poochunks

4 year lease

jchristian

Hi
I am also considering leasing a car but for 3 years. Is it correct that if i did this I could claim the full lease cost each year as well as all actual running, repair costs ect and actual miles used.

poochunks

while we are on this subject, i am currently claiming 40p per mile, can i change to the full expense claim at the strart of the next financial year??

Debt_Free_Chick

jchristian wrote: »

Hi
I am also considering leasing a car but for 3 years. Is it correct that if i did this I could claim the full lease cost each year as well as all actual running, repair costs ect and actual miles used.

Assuming you too are self employed, you can only claim the proportion that relates to business use. So if you use the car 75% for business and 25% for private use, you can only claim a deduction for 75% of the expenses.

jimmo

poochunks wrote: »

while we are on this subject, i am currently claiming 40p per mile, can i change to the full expense claim at the strart of the next financial year??

The general rule is that you can only switch systems when you change cars.
http://www.hmrc.gov.uk/manuals/bimmanual/BIM47701.htm
Have you also remembered that car hire costs are restricted if the list price of your leases car, when new, was more than £12,000?
http://www.hmrc.gov.uk/manuals/bimmanual/BIM47715.htm