Reclaiming From The Tax Man!

King of the Hill · April 15, 2006

Hi Guys,

I am thinking of buying a new GS450h...can you tell me how much can i claim back from the tax man?

I remember reading on a previous thread that one gentleman was claiming back his corporation tax of 19% against the whole value of the GS as he was claiming it as an asset.

I was wondering if i can claim back my business usage which is 60%. I am in the top tax bracket of 40% thus a total of 24%?...any advice would be helpful please!!! Does the hybrid allow me any extra tax breaks over the petrol?

Thanks for your time,

THE KING!!

King of the Hill · April 16, 2006

No one??? Is anyone an accountant?? haha

MacRS200 · April 16, 2006

I'm not an accountant but here we go.

If you have your own company, the company can buy the car and have it as an asset. The money paid would come out of profit and hence the company will save corp tax on the purchase.

You as an individual will then have to personaly pay tax for the use of the car which will be at the Inland Revenues standard rates for the car as a taxable benefit. Assuming you have a close company the company will already have paid corporation tax on the profit you draw as dividend, or if you pay yourself PAYE the money will have been subject to employers and employees NI (approx 23%) and that is before the benefit is taxed. The usual way in a close comapny is a mix of PAYE and Dividend anyhow HMR&C will have their cut.

In short it will probably not be worth it.

Gord · April 16, 2006

My wife drives company car, but said car is pool car so she pays not tax for driving it :D

Tango · April 16, 2006

No one??? Is anyone an accountant?? haha

I'm in similar circumstances, but my account advised me against the Company car route when I purchased my IS250 SE-L. Just ain't worth it.

MacRS200 · April 16, 2006

My wife drives company car, but said car is pool car so she pays not tax for driving it :D

Only till HMR&C do an audit and ask the company for records of who has been driving the car. Also as a pool car you are not allowed, under tax rules, to be used for driving to and from home to your "normal place of work".

Has your wife had a copy of a P11D from her employers? If so they have declared the car to the tax man, if not the directors face jail for falsifying tax returns if ever found out.

It is her duty to declare the car to the tax man, the Revenue can go back 7 years to recover unpaid tax. They usually wait about 2-3 years and then send you a bill for immediate payment.