Just had a visit from a taxi driver, he has asked if he can claim Capital Alawances (AIA) on the purchase of a taxi??, I have, in the past put cars in pools and claimed WDA. If he claims 100% AIA (this will clear any tax) but waist a lot of the allowance as the balance cannot be carried forwared, personly I think it would be best to pool the taxi as a car and claim a % every year, Has anyone got taxi drivers as cliants as some input would be graitfully received.
Goes beyond your immediate question but think that it may prove useful.
Sorry not able to offer any first hand advice on this one.
kind regards,
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.
Thanks Shamus,
looked at the link and this is one of the posts, The fixing of the hackney plate alters the type of the vehicle that cannot be driven by an ordinary member of the public (it can only be driven by somebody licenced to drive a hackney carriage), and so ceases to be of a type commonly used as a private vehicle and becomes unsuitable for such use, and so ceases to be a car (as defined). as this may be only one persons view, would anyone like to confirm this.
CAA 2001, S268A defines a car as a mechanically propelled road vehicle other than:
(a) a motor cycle,
(b) a vehicle of a construction primarily suited for the conveyance of goods or burden of any description, or
(c) a vehicle of a type not commonly used as a private vehicle and unsuitable for such use.
A mini cab is simply a car so would not be allowable for Annual Investment Allowance... But is not a black can also a car?
The answer lies in CA23510 (see here : http://www.hmrc.gov.uk/manuals/camanual/ca23510.htm) which specifically states that the following are not regarded as cars (see point (4)):
a car that it is illegal for a taxpayer to use as a private vehicle even if the taxpayer sometimes uses it as a private vehicle (Gurney v Richards 62TC87)
cars used by a driving school and fitted with dual control mechanisms (Bourne v Auto School of Motoring (Norwich) Ltd 42TC217)
emergency vehicles. A vehicle equipped with a fixed blue flashing light on the roof which can only be used on the road by a fire officer or police officer is an emergency vehicle
Hackney carriages ( traditional London black cab type vehicles)
Double cab pick-ups with a payload of one tonne or more. (Payload is the difference between a vehicles maximum gross weight and its kerbside weight.)
Conclusion. If it isn't a London Black Cab type vehicle (i.e. just a normal car used as a taxi) then AIA is not available for it.
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.
Thanks for the quick response, I had looked at the same link, when someone puts that little bit dought in your mind it drives you crazy, you spend more time checking up on something just to find you where correct in the first place.
It makes you think of the other taxi drivers that are telling this driver that they are claiming the AIA when they should not be, and why whould you waist the 100% allowance against low tax in the first place. (you wouldnt use an allowance of £15000 against £5000 and lose the £10,000,(as an example)).
I come accross it all the time where one person misunderstands something then spreads it around all of their mates who assume that because they are told something convincingly then it must be true.
There have been times were things in my office have got quite heated as telling a person that they cannot do something that all of their mates are doing (and my advice makes them worse off than their mates) goes down like a lead baloon and you are seen as the bad guy rather than the one saving them from themselves.
Hopefully this thread will warn any bookkeeper who does tax returns and who has heard from one of their clients that such treatment is acceptable that it really is not.
Not having any Taxi drivers myself this was an interesting one to look at. A second very practical thread in less than a week (the other being capitalisation of garden structures which got into an interesting debate between Michelle and myself).
Good to chat Joseph and welcome to the forum.
kindest regards,
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.
Interesting that Shaun, as I have a taxi driver on my books (in fact he was my first client back in 2009)
Remember reading about hackney carriages and AIA at the time to determine what to do, and because I couldn't make a definite determination I opted for WDA. So glad I did now.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
