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Post Info TOPIC: Claiming Motor Expenses for a Self-Employed Client
MichaelWGroves


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Claiming Motor Expenses for a Self-Employed Client
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I read this post with interest, I thought the £0.45 per mile claim was fully inclusive. But this post seems to suggest that if I have HP on my car I can also claim the interest amounts on this loan. Is this correct, also what about apportionment?

http://www.book-keepers.net/the-bkn-blog?mode=PostView&bmi=1517496

 

Thanks

Michael



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Shamus


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This one has got me flumuxed Michael as the 45p per mile (first 10k, 25p thereafter) is supposed to be compensation by the business for using a car that does not belong to the business.

I appreciate that the post related to BIM 47701 and I realise that it is for self employed only, not directors or other types of employee's.

I suppose that in itself that answers the question as for the self employed there is no difference between the person and business. However, surely this makes the interest a BIK?

Ok, you calculate the percentage used by the business and charge based on that percentage of the interest but you don't leave that percentage of the car at home when using the vehicle privately. It is inseperable so the tax relief is benefiting the taxpayer personally by reducing the cost of the finance therefore to my (admitedly slightly strange) mind its a Taxable Benefit in Kind (especially as everything including wear & tear and depreciation on business travel apportionment is buried in the 45p)

I'm very interested to hear other peoples takes on this as it doesn't feel as though its as simple as its being relayed in the blog as whilst yes, as a self employed (only) person you could claim a percentage of the interest (per BIM 47701) I'm thinking though that such is not the end of the story.

Shaun.


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Shaun

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StuartAnder


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Hi I believe it to be a BIK to an employee if the repayment to an employee exceeds the 45p and 25p rules, and I think it also makes sense that the interest on the HP would be a BIK if the employee was repaid it. As for a self employed person- as the note says the interest on the business proportion is allowable and im addition to the 45p and 25p rules Thanks Stuart

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