I am about to do a Self Assessment return for a new client. He has had to purchase a replacement van in the tax year. He wants to know if it is best to charge mileage or submit fuel bills.
I've just been looking on HMRC and it would appear that you cannot claim the AIA and also claim for mileage.
Mileage allowance is compensation by the business for use of your own vehicle.
AIA means that the vehicle is an asset of the business.
The two cannot co exist.
Note that this is not simply AIA but any capital allowances against a vehicle for which mileage is claimed.
With vans the choice can be less cut and dried than with cars and you are best computing under both methods before making a decision as once a decision is made is cannot be changed until change of vehicle.
HTH,
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.
You are claiming the Diesel (used legitimately for business with mileage log to back up the claim I assume), not the mileage.
There are basically two choices.
Run the vehicle through the business in which case all fuel, insurance, car tax, repairs etc. go through the business as well as capital allowances being available for the vehicle.
Or, you use the mileage rates as compensation for use of own vehicle which covers all car costs except for parking tickets which is the only motoring cost that can be claimed in addition to mileage.
With cars invariably the business owner is better off claiming mileage but vans can be a more problematic decision due to AIA being available and different treatment of home to work and different mileage benefit calculation.
As mentioned above, you really need to consider both scenarios taking all elements into account before deciding which option is best to go with.
Also worth noting is that you need to ensure that what you are claiming as a van really is a van in the eye's of HMRC. Sometimes thats not as obvious as it seems but if we are talking about your standard white van then its a pretty safe bet that it really is a van.
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.
Hi Shaun, The van definitely is a van and its white! All kitted out specifically to fit windows etc. My nephew hasn't provided any mileage log but we have claimed for the diesel.
Your nephew should keep a mileage log whether he claims mileage allowance OR the running costs of the van plus AIA.
The reason is that he can only claim the business proportion of the running costs plus AIA. And the best way of working out the business proportion is by keeping a mileage log
