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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
Satisfied Customers: 15973
Experience:  International tax
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I am employed and also work self employed. have recently

Resolved Question:

Hi
I am employed and also work self employed. have recently purchased a car on HP having paid a deposit, 46no monthly payments and final baloon payment at the end of the term inclusive of interest. I use the car approx, 10% private, 45% business use for my employment and 45% business for my self employment. My employers pay me circa 11-9p a mile for my business use undertaking their work. Am I able to claim capital allowance and offset interest payments or must I stick to claiming mileage allowance, thanks
Submitted: 1 year ago.
Category: Tax
Expert:  TaxRobin replied 1 year ago.
HelloThe 45% used for business independent of your employment is allowed for a claim of capital allowance. You must stick to mileage for the employee percentage.If you use cash basis accounting and purchase the car for business , claim this as a capital allowance as long as you’re not using simplified expenses for the business use too.Make certain you split the percentages correctly when claiming for the different uses.After you view my response, please post below if you need more information or if you need no further clarification a positive rating is appreciated.I know rating takes an additional step and I truly appreciate it when you take the extra time!
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Customer: replied 1 year ago.
Hi
Just one more thing regarding the interest on the Hire Purchase, this is excluded from the capital cost of purchase but can be claimed as a business cost?
Expert:  TaxRobin replied 1 year ago.
It is equivalent to ‘interest’ on the finance provided.Interest payable under hire purchase agreements is deductible where the asset is used for business purposes.
Customer: replied 1 year ago.
many thanks
Expert:  TaxRobin replied 1 year ago.
You are most welcome.