[Rob.Hall]

If you buy a second hand van for business use, how do you claim tax back on the tax return.
Do you claim aia, or can you claim a percentage back of the purchase value.
A bit confusing but I hope someone will understand 😕

[dazmond]

I used to put the whole price of the van through as one expense for that tax year when I used to buy cheap second hand vans for work...

Eg van £1200 (motor expenses)

[Simon Trapani]

I think it’s a capital allowance? I just leave it to the accountant.

[chris turner]

Put the whole purchase down as annual investment allowance. I have always bought used and done this. Although you have to bear in mind that depending on the cost of the van you may have no tax due that year but then essentially a double bill the year after with the payments on account! Currently dealing with this myself, 8k tax due in January.

[dazmond]

If you buy a second hand van for business use, how do you claim tax back on the tax return.
Do you claim aia, or can you claim a percentage back of the purchase value.
A bit confusing but I hope someone will understand 😕

If your van is just used for work I'd put the whole cost of the van through as a business expense for that tax year...

It doesn't get any simpler than that.

[Spruce]

If you buy a second hand van for business use, how do you claim tax back on the tax return.
Do you claim aia, or can you claim a percentage back of the purchase value.
A bit confusing but I hope someone will understand 😕

If your van is just used for work I'd put the whole cost of the van through as a business expense for that tax year...

It doesn't get any simpler than that.

What you need is to speak to an accountant about is how you show depreciation year on year. If your annual expenses are £3000 and your van costs £6000 then  you could well lose out claiming that against aia.

[Spruce]

Thinking about this today:

What happens if you rather take out a bank loan for the amount and write off the monthly repayments? This would then work in the same way depreciation does. You would still have your savings, which could be used as security for the loan.

Yes, you will have to pay interest on the loan, but that is also tax-deductible as it's a business expense.

[Stoots]

I always just did the 45p a mile thing, it depends how many miles a year you do and the purchase cost of the van as to whats best.

[dd]

Trouble with the 45 per mile allowance is it has not gone up in over 10 years, and I think it unlikely to do so in the next 10 years either.

[Spruce]

Trouble with the 45 per mile allowance is it has not gone up in over 10 years, and I think it unlikely to do so in the next 10 years either.

.......... and for the tax man you have to keep a daily record of miles travelled split into business and private where applicable.

[zesty]

AIA gotta be the best way, if the van is expensive, you’d have a next to nothing to pay in tax when you file that’s years assesment.

[Stoots]

Trouble with the 45 per mile allowance is it has not gone up in over 10 years, and I think it unlikely to do so in the next 10 years either.

.......... and for the tax man you have to keep a daily record of miles travelled split into business and private where applicable.

I put a tracker on mine. It logs it all online. Each month I just download it and pay myself the business portion. Doing the actual costs you have to split it as well so there's work involved either way.

True though the rate needs to go up its getting closer now which way is best depending on cost of van and mileage.

[Stoots]

AIA gotta be the best way, if the van is expensive, you’d have a next to nothing to pay in tax when you file that’s years assesment.

And when you sell it you pay tax on the profit.

[Spruce]

AIA gotta be the best way, if the van is expensive, you’d have a next to nothing to pay in tax when you file that’s years assesment.

And when you sell it you pay tax on the profit.

This is why they introduced it. It benefits the tax man in the end rather than us.

As a small business we are less likely to benefit from the complete vehicle claim in year one, but, as you say will get the full impact of tax when selling it.

This is exactly why they did away with write down allowance.

[zesty]

AIA gotta be the best way, if the van is expensive, you’d have a next to nothing to pay in tax when you file that’s years assesment.

And when you sell it you pay tax on the profit.

This is why they introduced it. It benefits the tax man in the end rather than us.

As a small business we are less likely to benefit from the complete vehicle claim in year one, but, as you say will get the full impact of tax when selling it.

This is exactly why they did away with write down allowance.

That’s assuming you sell when it’s still worth some dosh.

I bought my current transit custom for £14000 in 2016, it’s now worth only  £3700 

When I buy the new E transit custom sport, I will keep it for as long as possible, so it will be worth next to nothing when I one day sell it.

I’ve kept my current custom for almost 10 years now. AIA back then meant I paid a lot less tax. It was good deal for me!

With cash basis accounting, if I sell my current can for £3700 or whatever, then it only raises me income for the year by £3700, so hardly much in the way of extra tax. Nothing compared to the savings when I bought it…