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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4996
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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hello - happy new year! For the past couple years i have been

Resolved Question:

hello - happy new year! For the past couple years i have been a sold trader in antiques business doinng about 10 fairs a year with a relatively small turnover. June 2013 I bought a van (circa 8000) and in late sept/Oct using an inheritance opened a shop trading a limited no days each week. My turnover has of course substantially increased but still well under 79,000. I rent shop but before opening I needed to spend a large amount on its refubishment. Can you kindly advise how i handle both my van cost (no loan - and used for business only) and shop refurb cost (no loan). Also despite having van, i do find i still use my car for some business use ( say 25%) Can i claim for this in addition to van?? many thanks indeed
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site.
Thank you for requesting I answer your question.

As far as paying for the van and refurbishment of shop, both would be treated as capital introduced into the business.

Your entries in the accounts would be
Debit - Fixed Assets - van
Debit - Fixed assets - Refurbishment costs
Credit - Capital introduced

and you would claim capital allowance for the expenditure.

You say you use your car for some business use - if you have not claimed for it before, you may wish to claim fixed rate mileage allowance for business miles travelled. First 10,000 miles at 45p/mile and 25p/mile for over 10,000 miles.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.
Many Thanks for your reply which is understood but do both these get handled in the 2013/14 tax return or can cost get spread over several tax years?
Expert:  taxadvisor.uk replied 2 years ago.

Thank you for your reply.

If your profits are low or you are unlikely to utilise your personal allowances then you could defer taking capital allowances against this spend, thus spreading the capital allowance.

I hope this is helpful.

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