How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask TonyTax Your Own Question

TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15886
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
13905389
Type Your Tax Question Here...
TonyTax is online now

I work part self employed and earn a small amount from freelance

Resolved Question:

I work part self employed and earn a small amount from freelance work (less than ten thousand/per year). In the past I have claimed all my business travel on the standard 45 p per mile tariff. I am now though considering taking a monthly lease on a fully electric car. Are there any tax advantages in doing this (for example over non electric cars) - for example would the lease cost be claimable partly against tax?
Thanks
Duncan
UK
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi.

You can claim a deduction in your accounts for the lease costs less an adjustment for private use. Higher CO2 emissions cars (CO2s over 130g'km leased after 5 April 2014) will have the lease rental deduction restricted by 15%. See box 20 in the notes here. There are some notes with links on tax treatment of electric cars here.

You would need to compare the tax benefit of that against claiming the mileage allowance which is dependent on the business mileage you do.

I hope this helps but let me know if you have any further questions.
Customer: replied 1 year ago.

Thanks for this. If I was to go with a lease option - so I simply estimate my business/personal mileage ratio? Also just to clarify If I lease the car and claim for this I can't also claim any business mileage? Finally, would there be greater benefits if I bought the car rather than leased it - as a Capital allowance?

Thanks again

Expert:  TonyTax replied 1 year ago.
You ought to keep a decent record of your mileage as HMRC may ask you to back up your claim. They don't generally like estimates.

You either claim the lease payments or the business mileage, not both. Once you have selected a method, you are stuck with it until you change the car.

As its is an electric car, you could write off the entire cost against your self-employed income for the year you buy it using the first year allowance rules. However, that may come back to bite you if you sell it as you only get in capital allowances what the net cost of the car to you is (cost less disposal) so there may be a clawback in a later year when you may be paying a higher rate of tax.
Customer: replied 1 year ago.

Thanks - just one last question - does the option of writing off the entire cost of purchasing a car apply to used as well as new electric cars?

Expert:  TonyTax replied 1 year ago.
It's only new electric cars I'm afraid. Take a look at paragraphs 9.1 and 9.2 here.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15886
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you

What Customers are Saying:

 
 
 
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
< Previous | Next >
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
 
 
 

Meet The Experts:

 
 
 
  • Sam

    Sam

    Accountant

    Satisfied Customers:

    7088
    26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
< Previous | Next >
  • http://ww2.justanswer.co.uk/uploads/TA/Tax Expert/2013-8-21_231010_sam.64x64.jpg Sam's Avatar

    Sam

    Accountant

    Satisfied Customers:

    7088
    26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
  • http://ww2.justanswer.co.uk/uploads/BI/bigduckontax/2013-8-12_222058_1.64x64.jpg bigduckontax's Avatar

    bigduckontax

    Accountant

    Satisfied Customers:

    2333
    FCCA FCMA CGMA ACIS
  • http://ww2.justanswer.co.uk/uploads/TA/TaxRobin/2013-8-28_16186_femalebusinessprofessionalbinderhand11038485.64x64.jpg TaxRobin's Avatar

    TaxRobin

    Tax Consultant

    Satisfied Customers:

    524
    International tax
  • /img/opt/shirt.png taxadvisor.uk's Avatar

    taxadvisor.uk

    Chartered Certified Accountant

    Satisfied Customers:

    2845
    FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
  • http://ww2.justanswer.co.uk/uploads/MS/MsAM/2012-6-9_16426_anna.64x64.jpeg Anna's Avatar

    Anna

    Teacher, writer, biologist

    Satisfied Customers:

    270
    Great research skills, variety of work experiences, teaching experience.
  • http://ww2.justanswer.co.uk/uploads/PD/pdheslin/2012-6-6_232056_pambig.64x64.jpg pdheslin's Avatar

    pdheslin

    Consultant

    Satisfied Customers:

    51
    20+ years of internet site creation and search engine optimization. Dozens of search tools at my disposal.
 
 
 

Related Tax Questions