Mileage claimable for property managed by agent?

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    #31
    The landlordzone article says a vehicle can be a deductable expense for landlords;

    You can also claim capital allowances on the cost of the vehicle
    HMRC says it isn't;

    Capital expenditure on providing the means to travel (usually a car or van) isn’t deductible

    Comment


      #32
      Originally posted by boletus View Post
      The landlordzone article says a vehicle can be a deductable expense for landlords;



      HMRC says it isn't;
      HMRC are saying the cost of the vehicle (say £4,000) is not deductible as it is a capital item - which is correct.

      In the quote you gave, they go on to say plant and machinery allowances are allowed which is also correct. Although the initial expense is not deductible against tax, the purchase may qualify for P&M, dependent on the wholly and exclusively test and ultimately you will get relief through this tax relief.

      Note the subtle distinction between the expense being an allowable deduction and it qualifying for tax relief. To the ordinary tax payer, they just want to know if they get a tax deduction (and focus in on it's deductibility), and may jump to your conculsion on the reading of that sentence you quote above.
      I can take no responsibility for the use of any free comments given, any actions taken are the sole decision of the individual in question after consideration of my free comments.

      That also means I cannot share in any profits from any decisions made!

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        #33
        Hello Phlash,

        I'm struggling to understand what you're saying (my fault).
        Can you give an example, of a landlord purchasing a car, to help me understand please.

        Comment


          #34
          Capital expenditure on providing the means to travel (usually a car or van) isn’t deductible in computing rental business profits; nor is a depreciation charge.
          This is strictly true. You don't get a tax deduction for capital expenditure.

          But plant and machinery capital allowances may be available.
          However, certain sorts of capital expenditure give rise to capital allowances.

          These allowances are deducted in computing the business profit or loss.
          And capital allowances are tax deductible.

          Therefore, effectively you get a tax deduction for your capital expenditure on a motor vehicle (restricted to the extent it is used privately - hence the 40/25p is generally better for the taxpayer), but the taxman is merely saying that you get a deduction for capital allowances which are given as a result of capex.

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            #35
            I though that you told us [post #27] the opposite. Now I'm confused...
            JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
            1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
            2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
            3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
            4. *- Contact info: click on my name (blue-highlight link).

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              #36
              Golly. Times are hard for the soliciting fraternity if they view their cars as residential property!

              A car is not residential property.

              Capital allowances are not available on residential property (except in common areas in blocks of flats or FHLs).

              Capital allowances are available for cars (restricted for the private use element).

              Comment


                #37
                Sorry, I'm still confused.
                To help me clarify;

                As a landlord, can I buy a Rolls Royce for £100000 and use it strictly, wholly and exclusively for my landlording purposes.
                Can I then sell it after one year for £90000 and claim the £10000 loss against my rental income?

                Comment


                  #38
                  Originally posted by Telometer View Post
                  Golly. Times are hard for the soliciting fraternity if they view their cars as residential property!
                  Lincoln Lawyer?!
                  JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                  1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                  2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                  3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                  4. *- Contact info: click on my name (blue-highlight link).

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                    #39
                    Yes Boletus that is correct. Don't forget you have lost £10,000 for the pure pleasure of collecting rents in that vehicle.

                    Comment


                      #40
                      Am I right in thinking that the cost of a van purchased exclusively for use in a rental business can be claimed as a capital allowance and 100% of the cost can be claimed in the first year ?

                      Comment


                        #41
                        Yes - assuming the cost of the van and other plant and machinery is less than the AIA (annual investment allowance, 25k (more in some earlier years)).

                        Comment


                          #42
                          Originally posted by Telometer View Post
                          Yes - assuming the cost of the van and other plant and machinery is less than the AIA (annual investment allowance, 25k (more in some earlier years)).
                          And that it is a "van"!!
                          I can take no responsibility for the use of any free comments given, any actions taken are the sole decision of the individual in question after consideration of my free comments.

                          That also means I cannot share in any profits from any decisions made!

                          Comment


                            #43
                            The problem is that the rules have nothing to do with fairness or indeed responsibility for maintenance.

                            The rules are reliant on the rules that define your place of business. And if you have a managing agent then your place of business is his office, and you can never claim for the costs of getting to his office.

                            Comment


                              #44
                              so if the property is my place of business, it is not where I keep my tools, so I should be ablt to claim double millage, as I would need to travel from my place of work to where I keep my tools and back.

                              Comment


                                #45
                                If you actually DO that then: So, leave home drive 100m to your agent, drive home 100m to collect tools, drive 100m to property, drive 100m back home to drop tools and drive 100m back to agent and then 100m back home.

                                So you have driven 600 miles, of which 400 are potentially tax deductible. You reckon it's worth it?

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