I run a limited company servicing a very niche market, which involves a lot of mileage.
For the first 9 months I have been using my own vehicle and claiming expenses from the company.
The company is about to purchase a pickup and I will using this going forward.
Not knowing any better, I had assumed that one could obtain an insurance policy in the company’s name to cover the vehicle, however it appears that “commercial van insurance” still ends up being in the name of the proposer/director i.e. myself and with the exception of being able to easily add cover for contents over and above what most private policies have, there seems to be no beneficial difference and several down sides as opposed to just insuring it on the existing personal policy with business use covering everything other than the carriage of goods.
So I have option A: Take out “Van” insurance that has me as the policy holder.
Option B: Just replace the current vehicle (leased) with the new vehicle (owned by the company).
It would appear that in both cases any receipt/invoice would be in my name and not the company’s, as I am the policy holder. If I go option A then I will pay on the company CC and try to put it through the books, and if Option B I will pay for it personally I guess and look to claim it as an expense (there is no personal use on the vehicle per se).
My accountant is of the opinion that in circumstance A the policy should be in the company’s name, which doesn’t seem feasible, and in the case of option B I cannot claim the expense (not good).
Anyone have any experience of this and any advice to offer. Something that seems so simple is seemingly very complicated.
Any advice given here is at your own risk. The forum is for the accounting entries relating to transactions and isn’t an accountcy forum. Any advice you act on which turns out to be bad will fall on yourself as no one here has the PII insurance covering bad advice.
Finally id say that if you don’t trust your accountant to have all the answers for you, then I’d advise you find someone else. However that’s not to say, you accountant isn’t right.
I am sorry that you had to waste 30 seconds of your time on this question.
“Any advice given here is at your own risk” - Obviously.
“The forum is for the accounting entries relating to transactions and isn’t an accountacny forum” - According to the topic description, it is for " Any accounting related questions should be posted under this category. Quick File are not able to offer dedicated accounting advice here but we will try to provide general guidance where possible".
Given that it seems that plenty ask for general advice or opinions here and the topic title seems to encourage that, I tried my luck. I stand corrected.
"Any advice you act on which turns out to be bad will fall on yourself as no one here has the PII insurance covering bad advice". - Again, obviously.
“Finally id say that if you don’t trust your accountant to have all the answers for you, then I’d advise you find someone else. However that’s not to say, you accountant isn’t right.” - I didn’t say I didn’t trust my accountant nor did I suggest that they weren’t right.
I was hoping however that certain helpful individuals on here who run company vehicles and/or do their own accounts etc. have something to offer in terms of advice or experience, hence the use of “Anyone have any experience of this and any advice to offer”.
The reason for my post was quite frankly because, company vehicles are not something straight forward and some people who do their own accounts may well be doing it wrong.
I’d find it highly unlikely that anyone who does there own accounts would know more than your accountant who’s most likely studied the area in depth for many years.
I’d also be surprised if anyone on here would be able to advise you on the tax consequences of any decisions you make based on bad advice.
If you feel my post offended you, you can of course ignore it. And others are of course free to comment.
when I had a company car, the company purchased the vehicle and was listed as the registered keeper on the log book.
There were only a handful of insurers that I could find who would insure company vehicles and it was my name that was on the policy to drive that particular car which was owned by the company.
There might be policies that cover any employee to drive a company pool car, but that doesn’t sound like what you are asking about.
I paid for the insurance policy and claimed it back as expenses.
In your situation, I’d say you could process the insurance cost any way you like.
Your option A, using the company credit card is seems valid.
I’m not sure why you think you can’t claim back the cost of the isurance policy through your option B. Insuring a named driver seems a legitimate business expense to me, and I claimed it for years.
It’s not your fault that the van insurance market doesn’t cater for insuring a non-human company, and having to purchase a policy in your name seems a perfectly reasonable and legitimate business expense.
Hope this helps
Although not familiar myself with commercial vehicle insurance., I have client’s who have these policies on pickups etc. The policy is in the name of the company, as is the logbook and it must have at least one named driver.
One thing to be aware of is that policy holders of commercial vehicles cannot automatically drive cars in a 3rd party capacity as on motor car policies. A friend discovered this when chatting to his broker and he had been driving his wife’s car for years, believing he was insured on his pickup insurance. It can be added as an extra. Hope this helps.
Your experience on this is gratefully received and does seem like common sense.
I will revisit this with my accountant and also ask HMRC direct.
Thanks for your reply.
Do your clients happen to have two or more vehicles and thus able to get fleet insurance?
That does seem the only way to obtain a policy in the company name thus far from my enquiries but they of course haven’t been totally exhaustive.
I suspect they have fleet policies. The main factor is that the vehicle is in the company name on the logbook (V5). The company is then responsible for repairs, RFL etc. In the event that brokers can only provide insurance in your name, then this should still be allowable for Corporation Tax purposes.
You are perfectly entitled to claim insurance for business use. If the company owns the vehicle, and it’s not available for personal use, then you can pay for everything on the company c/c and claim the expenses that way.
Be careful, though, if you park it at home, as commuting to and from work is personal use, and if it’s parked on your drive it is therefore available for personal use.
In this case, you can claim for the business element but not personal. The easiest way to divide up is to log all your business miles (here are plenty of apps you can use for this).
It doesn’t really matter how you pay for it - if company card then it goes to rough the company books and you would adjust for any element of personal. If on your own card, put in an expense claim for true business use.
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