Unless the accountant has an arrangement with HMRC, it is my understanding that he is wrong to do so. The £500 only applies to vans (£3,000 from next year
).Paul
Bike as company car
- Thread starter Zed3
- Start date
Unless the accountant has an arrangement with HMRC, it is my understanding that he is wrong to do so. The £500 only applies to vans (£3,000 from next year
).Paul
My last offering. (Any other situations - seek professional advice as you should also do with the ones I have dealt with here 
).
Employee, own bike, employee pays all costs.
This is fairly simple. You can be paid 24p per business mile tax free. If you are paid more, the excess is taxable (and will be returned on the company's P11D). If you are paid less, you can claim a tax deduction on the shortfall.
The passenger allowance (5p per mile) appears not to apply to pillions according to the HMRC but inspection of the legislation would be advised to confirm this.
As ever, business miles do NOT include travel from home to work.
Standard caveats as above.
Paul
).Employee, own bike, employee pays all costs.
This is fairly simple. You can be paid 24p per business mile tax free. If you are paid more, the excess is taxable (and will be returned on the company's P11D). If you are paid less, you can claim a tax deduction on the shortfall.
The passenger allowance (5p per mile) appears not to apply to pillions according to the HMRC but inspection of the legislation would be advised to confirm this.
As ever, business miles do NOT include travel from home to work.
Standard caveats as above.
Paul
roger06
Guest
I had a VAT inspection and after admitting using the bike for personal use, we negotiated that 25% usage was personal so 25% of the VAT I'd originally claimed back I had to repay.
From what I've heard they will always get 'something' from an inspection, so if they clobber you for something else they may well overlook the bike (if it's use personally of course).
rdover
Registered user
The above accountant type stuff is bang on.
I've had a couple on interesting questions raised from a VAT inspection about keeping the bike at home. For you not to pay a benefit in kind charge the vehilce should eb used for commuting or be kept anywhere excpet to the work address, with the exception of doing deliveries/site visits etc out of hours or on the way to/from home. I persuaded them that as the bike can only be insured properly at my home address and that it is only properly secure there ti should not be considered for BIK. They agreed, with a sly smile on their faces, however this was backed up by the fat that I claim less than 2500 business miles per annum on my car thus supporting my claim that the bike is 99% used for business (which it is - even the charity run is counted as business).
As for equipment - all normal running costs (fuel, servicing, spares, accessoroes) are tax deductible and vat reclaimable.
If you look as though you are hiding something they will shaft you, however be open and up front and they will ignore the small stuff (racing can, sticky tyres, dayglo leathers)
I've had a couple on interesting questions raised from a VAT inspection about keeping the bike at home. For you not to pay a benefit in kind charge the vehilce should eb used for commuting or be kept anywhere excpet to the work address, with the exception of doing deliveries/site visits etc out of hours or on the way to/from home. I persuaded them that as the bike can only be insured properly at my home address and that it is only properly secure there ti should not be considered for BIK. They agreed, with a sly smile on their faces, however this was backed up by the fat that I claim less than 2500 business miles per annum on my car thus supporting my claim that the bike is 99% used for business (which it is - even the charity run is counted as business).
As for equipment - all normal running costs (fuel, servicing, spares, accessoroes) are tax deductible and vat reclaimable.
If you look as though you are hiding something they will shaft you, however be open and up front and they will ignore the small stuff (racing can, sticky tyres, dayglo leathers)
Thinking about it, I can see no reason why a company is not liable for output VAT on the private use element of the depreciation and running costs as well as a self employed person. I can see nothing to override this technically correct treament .
I would amend my post above but I'm too late. So insert para 7 from post #20 into post #17. If anybody can show me it doesn't apply that would be great.
Paul
I would amend my post above but I'm too late. So insert para 7 from post #20 into post #17. If anybody can show me it doesn't apply that would be great.
Paul
Yoda
Registered user
The Company can also consider acquiring the vehicle through a leasing scheme. This removes the need for CapEx and puts the whole thing on OpEx.
As long as the vehicle price is <£12k then the monthly rentals are 100% allowable against Corp Tax.
If there's any personal useage at all then 50% of the VAT on the rental charges is reclaimable. (No personal usage allows 100% VAT reclaim but I've found it's always best to take a moderate line with all of HMRC's people).
Mine is on a 3 year arrangement and at the end of 36 months it just goes back and I walk away. The dealer I got it through has committed in writing to underwrite the 3rd year warranty.
Personal b-i-k and Class 1A NICs are based on the 20% rule as discussed previously.
It works for me, but everyone needs to do their own figures.
As long as the vehicle price is <£12k then the monthly rentals are 100% allowable against Corp Tax.
If there's any personal useage at all then 50% of the VAT on the rental charges is reclaimable. (No personal usage allows 100% VAT reclaim but I've found it's always best to take a moderate line with all of HMRC's people).
Mine is on a 3 year arrangement and at the end of 36 months it just goes back and I walk away. The dealer I got it through has committed in writing to underwrite the 3rd year warranty.
Personal b-i-k and Class 1A NICs are based on the 20% rule as discussed previously.
It works for me, but everyone needs to do their own figures.
LiquidLAN
Registered user
Hi Zed, I run my 12GSA as a company vehicle, I'm MD of a limited company.
Basically as we stand today there are none of the penalties that are applied to a company car. All you are personally taxed on is the personal use of the bike (tax on 20% of the value per year) that's it, you can buy all you bike clothing as it is protective clothing and a requirement of safe riding. I could also charge all the servicing and fuel costs back to the company plus the cost off all accessories.
Reading your posting, I'm not sure if you are employed or working for yourself, but assuming you work for yourself and you are VAT registered, the VAT side of it gets more interesting. Personally I've chosen not to claim the VAT back on the bike as I would then need to justify business verses personal use... all to much hassle if you ask me.
One important point to note though is if you buy a bike through a company you are not covered by the same consumer protection as you would be if you bought one personally. If you've been reading some of the postings here there is a fair amount of talk of fit for purpose and reasonable expectation... these are only covered by consumer purchase. If this is going to be a company purchase and you are going to do anything more than road riding, I would suggest you get something written in to the contract of sale regarding your expectations.
Basically as we stand today there are none of the penalties that are applied to a company car. All you are personally taxed on is the personal use of the bike (tax on 20% of the value per year) that's it, you can buy all you bike clothing as it is protective clothing and a requirement of safe riding. I could also charge all the servicing and fuel costs back to the company plus the cost off all accessories.
Reading your posting, I'm not sure if you are employed or working for yourself, but assuming you work for yourself and you are VAT registered, the VAT side of it gets more interesting. Personally I've chosen not to claim the VAT back on the bike as I would then need to justify business verses personal use... all to much hassle if you ask me.
One important point to note though is if you buy a bike through a company you are not covered by the same consumer protection as you would be if you bought one personally. If you've been reading some of the postings here there is a fair amount of talk of fit for purpose and reasonable expectation... these are only covered by consumer purchase. If this is going to be a company purchase and you are going to do anything more than road riding, I would suggest you get something written in to the contract of sale regarding your expectations.
LiquidLAN
Registered user
this is what I have been advises also... I think the difference is that camel_landy seems to be suggesting he never uses his bike for personal use...
LiquidLAN
Registered user
sounds like he needs a better accountant.
Correct...
As I rely on my bike for work, I can't afford to go out and break it while playing... When not working, I usually use one of my Landies but I am considering something else as a 'toy'.
M
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theory900
Registered user
I bought my r1200gs new in October through the company and the accountant has just come back to say that my taxable benefit will be £1,600 a year, which will be taken from my salary before tax. The bike cost £9,500 inc. vat and is in the companies name.
I use the bike for work and for personal use, all fuel, road tax, insurance, maintenance and repairs are paid for by the company.
Does this sound right?
I use the bike for work and for personal use, all fuel, road tax, insurance, maintenance and repairs are paid for by the company.
Does this sound right?
LiquidLAN
Registered user
yep, sounds ok... don't forget its Taxable Benefit not tax... whatyou will pay is your higher rate tax percentage on £1,600 so maybe £400???
ac92413
Guest
FAO: yoda
Hi Yoda
I'm a VAT registered IT contractor and was considering buying/leasing a new GSA through the company.
How have you done it? When you way up the monthly lease rather than paying off finance is it still worth it; i.e with the latter you are left with a bike at the end of the 3 years and with the former you just give it back I presume.
Many thanks
Andy
Hi Yoda
I'm a VAT registered IT contractor and was considering buying/leasing a new GSA through the company.
How have you done it? When you way up the monthly lease rather than paying off finance is it still worth it; i.e with the latter you are left with a bike at the end of the 3 years and with the former you just give it back I presume.
Many thanks
Andy
Al Jackson
Guest
Thats what I was going to say. Just buy it normally and claim 24p a mile for business mileage. Saves a lot of admin this way.
Bones
Registered user
I'm a VAT registered IT contractor as well. A site I was at recently had a good half of the contractors going out and buying bikes to beat congestion charge, they all claimed the VAT back.
I've done this and the VAT inspector didn't have a problem on a recent visit
Buy a new one and claim the VAT back. Put all servicing, accessories (they are ALL essential) safety clothing
etc through the books. Put a sticker on it with your company name and call it a delivery vehicle.
There was a long thread on this very subject recently, you'll find it if you look, with a whole host of contradictory advice about what you can and can't do.
Get your returns in on time and no one checks anyway
I've done this and the VAT inspector didn't have a problem on a recent visit
Buy a new one and claim the VAT back. Put all servicing, accessories (they are ALL essential) safety clothing
etc through the books. Put a sticker on it with your company name and call it a delivery vehicle.There was a long thread on this very subject recently, you'll find it if you look, with a whole host of contradictory advice about what you can and can't do.
Get your returns in on time and no one checks anyway
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