Capitail allowance on van

Accounting
1

I purchased a van in 2017 and recording the finance payments under assetts nominal code 50 motor vehicles can i claim capitail allowance on vehicle as well im using cash basis for tax returns, thanks

2

Hi,

I was reading up about capital allowances yesterday and HMRC have a helpsheet, known as Helpsheet 222 or HS222.

It’s at this address: HS222

Under the title: Allowable business expenses: cash basis and traditional accounting" the helpsheet lists allowable and non-allowable expenses for both cash and traditional (accrual) businesses

Bank, credit card and other financial charges.

Allowable:

Bank, overdraft and credit card charges, hire purchase interest
and leasing payments.
Alternative finance payments.
If you use cash basis the maximum amount you can claim for interest and incidental costs of obtaining loan finance is £500.

And under the title: Capital allowances and balancing charges
it states: “If you’re using cash basis, you can only claim capital allowances on cars. The cost of all other equipment and vehicles is an allowable expense in working out your business profits.”

Your situation might be different if you are leasing the van, as I think different rules apply to leases.

Hope this helps a little.

3

Please excuse the capital letters in the above post - I don’t know how that happened !