I have a client who was trading as a sole trader but has now set up a Ltd Company and is asking what the advantages would be to transfer the vehicle so that it is owned by the Company rather than himself. The vehicle is only used for delivering their products to clients. What would you advise?
Not the best time to be asking - January madness and all that.
LOTS of info missing, eg just of some of it....
Other staff? Pool vehicle? Where kept? Owner have/access to another vehicle? Type of vehicle? Is there ANY type of personal mileage (even home to work)? ANY at all?
Consider, just some rambling thoughts.... personal tax circs how claiming costs now/future (which is optimal)? BIK Cap allowances Capital gains? VAT on purchase by limited from S/T? Finance on vehicle - will finance co allow transfer? Insurance - possible to insure via a new limited?
What would you advise? Even if you dont cover everything - have a go and then someone can comment/guide you on your thoughts.
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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
Other staff? Only his wife who doesn't use it
Pool vehicle? No
Where kept? At home/work - his workshop is at his home address
Owner have/access to another vehicle? yes
Type of vehicle? large van
Is there ANY type of personal mileage (even home to work)? ANY at all? None
Consider, just some rambling thoughts....
personal tax circs, small personal pension and paid as an employee
how claiming costs now/future (which is optimal)? will look into it
BIK
Cap allowances
Capital gains?
VAT on purchase by limited from S/T? None
Finance on vehicle - will finance co allow transfer? None
Insurance - possible to insure via a new limited? Will ask
Sorry I know its a busy time of the year I've never been asked about it before.
Issue you have, amongst others, would be persuading HMRC that he does no personal mileage. In fact even it being 'available' for personal use is the issue. Albeit you might swing it with it being a large van, but I will hazard a guess he uses it when his wife is out and he needs a vehicle. That is an issue.
Whilst never being asked before - just have a go at puting some thoughts down (including disadvantages) - we wont judge you. In fact, judged much less harshly for having a go and getting it wrong, than not having a go.
Do you have someone that you refer such tax issues to to get advice (given your PII will not cover it if you cannot answer it? Just a thought).
I take it this one can be re-surfaced in Feb if needs be?
__________________
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
Has the van been claimed for by the sole trader business, as in AIA or WDA?
Lots to consider and every situation has different circumstances but I have found that usually with a car then it is better to just claim the mileage rates but with a van it is better to run the figures between the mileage rates and the actual costs and depending on what I have asked above maybe transfer the van over into the Ltd name.
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Doug
These are only my opinions of how I see things and therefore should not be taken as advice
