Company Car Advise

[glennbtn]

HI

I started a company 6 months ago and bought a car for £2000 to use and put this against the directors loan. This weekend I replaced the car with one worth approx £9000 whch was funded by me and not the company. I need to know what would be best for me to do as my accountant is useless and I need to get another.

The company is not doing great and I am not sure if I will continue being self employed or go back to employment. Would it be best to pay back to the company the px price obtained for the old car or put the new car back in to the business against directors loans.

If I put the car in to the business and closed it where would I stand with regard to owning the car etc as have no intention of selling it. If I owned the car instead would I still be able to claim fuel and repairs etc.

Sorry for all the questions, new accountant on the horizon I guess

[MyAccountantOnline]

HI

I started a company 6 months ago and bought a car for £2000 to use and put this against the directors loan. This weekend I replaced the car with one worth approx £9000 whch was funded by me and not the company. I need to know what would be best for me to do as my accountant is useless and I need to get another.


You have 2 options when your business is operated via a limited company -
1. Buy a car yourself and claim for business mileage from the company at 40p per mile for the first 10,000 miles and 25p for all mileage above this, or

2. The company buys the car claims capital allowances on it (an allowance for wear and tear - the rates depends on the car) and you are charged a benefit in kind, a tax charge, based on the list price of the car when it was new.

Which option you take depends on many factors including the list price of the car and its emissions.


The company is not doing great and I am not sure if I will continue being self employed or go back to employment. Would it be best to pay back to the company the px price obtained for the old car or put the new car back in to the business against directors loans.


Without more information it is not possible to answer this - if the car is owned by the company youu would need to buy it back at market value if you want to avoid a tax charge.


If I put the car in to the business and closed it where would I stand with regard to owning the car etc as have no intention of selling it. If I owned the car instead would I still be able to claim fuel and repairs etc.


I think the answers to your earlier questions hopefully answer this.

Hope that has helped:)