Hi everyone, first post so be nice. I have really looked at the other related entries and cannot find something specifically similar.
I currently make a claim for motoring expenses and split between business and private use. Only 20% is business use - it changes each year between 15 and 25%.
I understand that if I buy a new electric vehicle - lets say for 100k, then I could write down all the tax relief in the first year, but that would only be the business part - so 20%, i.e. 20k reduction.
BUT
What if I get the car delivered in March, leave it office car park and only use it for business work + the odd mile of personal use. Between car delivery and end of my accounting year/ financial year I would be using that car 95% for business.
Then would I get 95% of the purchase price written down against tax in the first year?
And then in the second year (after the residual value of the car has dropped to 0) I can start using the car normally i.e. 80% personal and 20% business.
I totally understand on selling the car I will need to pay tax on the sale price.
Am I right that this is how it would work? Or is this idea totally wrong and illegal?
For full clarity I have already run it through my accountant - but she will not get back to me for a fortnight - they are clearly behind with their more urgent work because of Covid. I just don't want to get too excited about a better car if I am completely barking up the wrong tree.
Thank you in advance to everyone who takes the time to reply.
Bonglim
I currently make a claim for motoring expenses and split between business and private use. Only 20% is business use - it changes each year between 15 and 25%.
I understand that if I buy a new electric vehicle - lets say for 100k, then I could write down all the tax relief in the first year, but that would only be the business part - so 20%, i.e. 20k reduction.
BUT
What if I get the car delivered in March, leave it office car park and only use it for business work + the odd mile of personal use. Between car delivery and end of my accounting year/ financial year I would be using that car 95% for business.
Then would I get 95% of the purchase price written down against tax in the first year?
And then in the second year (after the residual value of the car has dropped to 0) I can start using the car normally i.e. 80% personal and 20% business.
I totally understand on selling the car I will need to pay tax on the sale price.
Am I right that this is how it would work? Or is this idea totally wrong and illegal?
For full clarity I have already run it through my accountant - but she will not get back to me for a fortnight - they are clearly behind with their more urgent work because of Covid. I just don't want to get too excited about a better car if I am completely barking up the wrong tree.
Thank you in advance to everyone who takes the time to reply.
Bonglim
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