Client has just started as a sole trader. He doesn't want to do mileage for his car, he wants to claim the costs and take off personal use proportion. He already owned his car before he became a sole trader. Can he claim capital allowances on it? If so, what value should I put on the car at the start of trading? Market value?
He also has another car which is on Hire Purchase and wants to do the same with that one. I can't find the bit in my AAT books on how to deal with HP. The HP started before he became a sole trader. How do I work that one?
I cant help specifically other than to say Im sure a HMRC man said recently that you couldnt claim the car was in the business if you bought it before the business was set up! Dont forget he has to tell them when he started as self employed! But as Im not an expert how about you attend a HMRC webinar on Capital Allowances for the self employed - they are running some very soon (next week) and have a rolling programme of them. You can view webinars already had although I think it would be well worth an hour of your time as you can ask as many questions as you want to make sure you get what you need out of it. You can be pretty specific with those questions too! Plus they are completely free. Find a suitable date for you via HMRC website or via this link http://www.business-events.org.uk/events/capital-allowances-for-the-self-employed--1
I will be attending one too
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
