My husband has a Ltd company and is looking to lease a new car. The car in mind has a list price of £27,195 and 125 C02 emissions which on HMRC's website gives a tax valuation of £1,100 per annum.
Would it be advised to a personal lease and claim back mileage at 45 pence per mile or to do a business lease and claim mileage/or use a fuel card.
All depends on your business mileage as to which route proves more beneficial.
You need to calculate out using both methods in order to determine which the best option for your business is.
As the car looks to be a higher mid range model I'm suspecting that running through the company will end up the better option but as I say, it all comes down to the business mileage that he'll be doing.
Hope that helps for starters,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
fuel is a different kettle of fish in that you get no reduction for partial personal contribution making personal contribution for personal mileage pretty much a non starter and as the car does not belong to the director (but to the company) the 45p per mile is not an option.
With such low business mileage for such an expensive care it's also not going to be viable buying personally and charging the company mileage.
Is there any good business reason why he needs such an expensive car? If not, if the cars to impress clients then why not buy a second hand car personally and charge mileage through the company. There are certainly plenty of good deals to be had on second hand beemers and mercs at the moment and to my mind a five year old one of either of those is a lot more impressive than a brand new car from a lot of other manufacturers (Audi owners can start burning effigies of me now (lol)).
If the car is something role specific rather than an ego purchase (such as a 4wd for off road / building site work) then there's likely to be very little by way of option in which case considering the cost I believe that you will find putting everything through the company a better option.
However, you should either do your calculations based on both approaches and make your decision that way or consult your accountant who will be able to take all of your tax matters into consideration before giving you the proper decision in relation to your specific circumstances.
kind regards,
Shaun.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Haha, no, it's definately not an ego purchase! It's just he's been offered a very good deal on a Mercedes estate which works out extremely cheaper than any Ford's or Vauxhall's plus as he's a sports coach, the boot size is very important and the Merc's is considerably bigger than any of the cheaper models. We have originally been looking at pickups but the fuel consumption is ridiculous upto the car we're now looking at and again, a good £130 at least cheaper a month than the Merc we're looking at.
