Hoping someone can help me. I'm a novice book keeper so be gentle (doing own accounts for my business).
I purchased a car for £1000 in August 2010 and my previous accountant put it through the books. On her last set of accounts with a year end of 6th April 2012 , she has put the following:-
Cost
At 6th April £1000
additions - £0
At 5th april 2012 = £1000
Depreciation:
At 6th April 2011 £150
Charge for the year £150
As at 5 April 2012 - £300
Net book value:
At 5th April 2012 £700
At 5th April 2011 £850
I didn't enter anything for y/e on the tax return for y/e 2013 and I got rid of the vehicle in July 2013 for £500.
My question is, how do I actually process the sale of the car and enter it onto my tax return? I've also got to deal with the addition of a vehicle.
I think I should have taken off another £150.00 for the year end 2013 which would then have given me a net book value of £550.00 for that trading year but I didn't actually enter it on the tax return (not sure why, but I missed it).
In June 2013 I purchased a brand new vehicle at a cost of £12794.
What you are referring to is the entries from an accounting viewpoint but this is different from what is entered on your tax return from a tax viewpoint.
What you need to get is the capital allowances claimed on the car from your previous bookkeeper/accountant. Was the vehicle in a separate pool or in the general pool and what if any personal use adjustment was put through. It is likely that the car would be in a pool on its own if there was private use.
You would need the above information to calculate what balancing allowance/charge is applicable on your tax return.
