Sole trader van purchasing

[Naduk]

Hi,

I've had a good read around of a few threads on here but still not 100% on the best route to take.

I am looking at purchasing a van for work, currently the funds would be coming from elsewhere, rather than directly from the business but it would be an all out purchase. Obviously, if a van is chosen where there is VAT on the price, I would have thought the best route would be to put it through the business. If the purchase is exclusive of VAT, would it still be better to buy it through the business and offset the cost or privately and claim the mileage for the timebeing untill the threshold is reached.

I would expect to do around 10k miles a year in it. I would be looking to spend upto £10k on the van.

The second issue is, I was looking at VW T5 LWB Kombi's to also allow at time, the movement of goods and staff as such at the same time, although I understand the combination vehicles can cause issues from a tax point of view, although I also understand BIK is not an issue for soletraders, I suppose I was looking ahead if the company were to changed to ltd. For those that don't know, the factory T5 Kombi seats are quick release so the majority of the time they would be out and the vehicle has a load capacity over 1000kg.

I have recently voluntarily registered for VAT, this was due wanting to claim back VAT on asset purchased which started 4 years ago and looking to be over the threshold in a few years, it was a case of now or register later and loose out somewhat.

Hopefully that makes sense!

Thanks

Nad

 

[Scalloway]

How much private mileage you are going to do would affect whether buying the van through the business or just claiming mileage is more beneficial.

Once you pick the method you are going to use you must stick to it for the lifetime of the vehicle.

 

[Naduk]

Hi,

Nothing that would fall outside of what hmrc say, drive to work, few tip runs, moving house etc.

The issue I saw that if doing it mileage based then I exceed the VAT threshold, I presume I would need to swap over?

 

[Scalloway]

No once you pick a method you must use it for the life of the vehicle. And the VAT registration limit doesn't apply any more for using mileage. Any sole trader can use it.

Sent from my HTC One M8s using Tapatalk