stuart roberts Posted January 30, 2009 Share Posted January 30, 2009 Dear Readers. This is my first msg, having just joined the forum. I have jumped in at the deep end and put deposit on a new Adria Twin. Having spent several months pondering which home to buy, she who MUST be obeyed, finally agreed . I am considering hiring out the Twin via a national company but have had conflicting information as to what tax allowances a motorhome hire business can benefit from. Annual investment Allowance for businesses is £50k but apparently cannot be used for motorhome purchase as MH classed as car by HMRC. Other alternative allowance is annual depreciation @ 20%. Im sure there are fellow hirers out there who can clarify what can be used and prehaps reccomend a good accountant who specialises in this area.. Cant wait to hit the road. stuart. Link to comment Share on other sites More sharing options...
colin Posted January 30, 2009 Share Posted January 30, 2009 You diffinatly need an acountant, get it wrong and you may end up with a tax bill for using motorhome yourself. Link to comment Share on other sites More sharing options...
josie gibblebucket Posted January 30, 2009 Share Posted January 30, 2009 Wonder if you can claim the entrepreneurs (spelling?) allowance? I think its something that has been introduced quite recently. Link to comment Share on other sites More sharing options...
brayn Posted January 31, 2009 Share Posted January 31, 2009 Motor homes are considered as cars for BIK purposes and so will be treated in a similar fashion for capital allowances. You can claim an annual writing down allowance of, now, 20% subject to a maximum of £3000 p.a. to set off against profits. This is reduced if there is any private use of the vehicle i.e. if you use it half for renting and half privately each year the allowance would be halved. You would be able to use either a time or mileage apportionment, depending upon which was reasonable. Note that there is no First Year Allowance on cars and that Entrepreneurs Allowance is for the sale of a business not an ongoing profit relief. Assuming you do not go to one the Big 4 accountants, you can expect to pay an annual fee in the order of £1200-£1500 for yearly accounts, tax return and sundry advice so long as you can provide an accurate cash book and balanced bank account. Many people do their own accounts and tax returns, it is straightforward, at least accourding to that annoying bloke with the bike helmet! By the way, if anyone suggests setting up a company to do this, please resist the temptation. Your accountancy fees will rise by at leat 50%, if not more! Link to comment Share on other sites More sharing options...
stuart roberts Posted January 31, 2009 Author Share Posted January 31, 2009 Thank you Brayn . My faith in fellow public has been restored. Ive read a lot of hype as to how much tax one can claim back. Your accessment concurs with what HMRC told me. Re the £3000 limit HMRC agreed motorhome could be classed as a 'qualifying hire car' which are exempt the limit with following conditions. Must not be hired to someone of more than 30 consecutive days and not to the same person for more then 90 days in any 12month period. Providing condition met then full 20% write down allowance can be claimed on a reducing balance basis, again subject to any personal use. I appreciate your reply. I must admit im far better at adding than spelling, surprised one reply was not in RED ink. So on a £30k purchase, 20% = £6k one can offset against any taxable income, from hire business. Anything back from the taxman must be a bonus.... Cheers Stu. (lol) Link to comment Share on other sites More sharing options...
brayn Posted February 2, 2009 Share Posted February 2, 2009 note that the 20% writing allowance is on a reducing balance basis, i.e. year 1 20% x 30000 = 6000, year 2: 20% x 24000 = 4800, year 3:20% x 19200 = 3840 etc. If you sell the van you will get either a balancing allowance or charge, i.e. if you sell after year 1 for 22000, you will get an allowance of 24000-22000 = 2000, as well as any allowance if you buy a new van. All pro rata for personal use. P.S. I'm glad the IR concur, it should give you faith in Chartered Accountants and Chartered Tax Advisers! Link to comment Share on other sites More sharing options...
stuart roberts Posted February 3, 2009 Author Share Posted February 3, 2009 Brayn. Was that a little bit of salemanship!! Im surprised at lack of responce, as im sure there are lots of hirers out there, with knowledge. The tax allowances look reasonable if using MH purely for hire. I would be hire/own use, so not so attractive. I have an accountant for house rented out. Said he couldnt advise me???? Anyway having fun now adding bits to van which is being registered with dealer for 09 plate. Opted for Gaslow twin system. Considering Toad Cat 1 alarm system to improve on manufacturers basis immobiliser. Any thoughts. Anytime you need answers for any criminal/motoring issues, let me know!! Link to comment Share on other sites More sharing options...
brayn Posted February 4, 2009 Share Posted February 4, 2009 In my experience, which is quite large, I have never come across so many 'old wives tales' as exist in taxation. One of my ares of expertise is in Inheritance Tax and the number of variants on what is taxed and at what rate are legion. Incidentally, I am now retired and only work in January, for my old firm. Link to comment Share on other sites More sharing options...
stuart roberts Posted February 4, 2009 Author Share Posted February 4, 2009 Brayn. Will be joining you in land of leisure on 19th. Counting the days down. See you have simular size van. I looked at the Exsis but didnt suit our needs. Had a test drive, in the Twin. So nice to be in high position overlooking everyone else. Just like the Riot Van I used to drive, but no blue lights? Will have to control missus from packing everything incl kitchen sink or will be overweight. Stu. Link to comment Share on other sites More sharing options...
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