Purchase or lease a second hand car for Driving Instructor

Accounting
1

I’m trying to get my head around the current tax position and accounting requirements with purchasing a car for use as a driving school car. I’m self employed and need to purchase or lease a car which will have dual controls fitted. I know that cars with dual controls are now no longer allowed to use the simplified expenses mileage claim (which I have previously been doing).

On trying to read the latest on the government website, it would appear that if I was to purchase a second hand car with CO2 emissions of over 50mg/km, it will only qualify for a ‘special rate allowance’ of 6% per year?

The value of the car depreciation will far outweigh this. So for example, if I buy a car for £20,000 then I can claim £1200 each year? But the business ‘me’ has paid out £20,000 from its profits to purchase the car or taken out a loan/pcp etc.

How is all this accounted for? Would I be better to lease and claim 100% of the monthly lease.

I’m sure I’m not understanding this correctly. Can someone explain? I want to make sure I’m using the most tax efficient way of financing a vehicle that I cannot do my job without.

2

Then you should definitely talk to your accountant to get proper professional advice tailored to your circumstances.

1 Like
3

Yes tried that once before. I ended up telling the accountant you could no longer claim mileage! I’ve since been put off accountants. It’s a strange one. All the accountants I’ve previously employed or spoken to have been happy to take my money, give advice. But won’t be held liable for that advice of incorrect!

4

Hello @jamkat28

As @ian_roberts correctly mentioned, we would recommend speaking to an accountant. If you don’t have an accountant, we have a panel of accountants to choose from, for more information, please see the following link:

1 Like
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Thank you all for your replies. However my post was written in the hope of not involving accountants. I’ve since found my answer elsewhere.

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