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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5638
Experience:  FCCA - over 40 years experience as a qualified accountant (UK based Practitioner)
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Hi, I am completing my partners accounting records. He is

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I am completing my partners accounting records. He is a black taxi driver. I am confusing myself, as I am used to vehicle purchases, but not leasing. Could you possibly check the claculation below and offer any advice?

WDV b/f £2148
Sale £6327 (27/12/12)
Bal. Charge £4673

Then lease from 27/12/12
£648.43 per month

I am confused as to how to show these transactions in relation to Capital Allowance. I obviously need to adjust the WDV b/f balance (Apr 11 to Dec 12 element would be £1611). Would i then treat the lease as an expense from December to March 13? (£2593)

Any advice would be much appreciated.
Hello and welcome to the site. Tina, thank you for your question.

Leasing costs £2,593 would be expensed as motoring expense and charged against the turnover ... you are correct in your thinking.

You say WDV b/f at the start of accounting period was £2,148 and the vehicle was sold in the accounting period in question.

Your calculation of balancing charge appears correct based on your figures. Where does £1,611 come from .. should £2,148 be reading £1,611 or what?

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 5 years ago.


Thank you for such a quick response.


The figure of £1,611 is the £2,148 / 12 * 9 months (as the hire purchase started from December 2012. Or should I claim the full amount of £2,148?


Sorry to seem vauge. His books are normally very straight forward. This has thrown me, as I need to records the lease and then in 2015 he has the option to buy the taxi for the price of £22,567


Thank you for getting back to me so quickly. Much appreciated.



Tina, thank you for your prompt reply.

You should use WDV b/f as £2,148 and work out your balancing change on it.

I hope this is helpful

Customer: replied 5 years ago.

Could you see if this look ok for me please?


WDV b/f £2,148

Sale £6,327

Balancing Charge £4,179


Then for the leasing costs (shown in expenditure) I would calculate the lease costs from the start date of 27 Dec 12 to March 13?


Many thanks,


Tina, thank you for your reply.

You are reporting correct figures

Balancing change £4,179
Leasing cost as expenditure £2,593

I hope this is helpful and answers your question.
Customer: replied 5 years ago.

I am thrilled to have found your site! - I cannot thank you enough for such a quick informative service. I will most certainly be using your services again.


Thank you!


Kind Regards,


Tina, I am glad you found my service helpful.


If I can help you again, please request for me to answer your question.


If you are happy and there are no more issues I will appreciate if you would kindly rate the service I provided to ensure I get paid for it. and other Tax Specialists are ready to help you
Tina, I thank you for accepting my answer.

Best wishes.