Taxation and Commercial Vehicles
Commercial Vehicles can be allocated into either the AIA (Annual Investment Allowance) Pot, or the Plant and Machinery Pot. If they are allocated into the AIA, they qualify for 100% WDA (Writing Down Allowance) in the year of Acquisition. Currently a business has an AIA of £100,000 per annum. From April 2012, this will be reduced to £25,000 per annum. Any reasonably sized business will quickly use up this £25,000 allowance, and any purchases over this amount will fall into the Plant and Machinery Pool (except cars that emit >160 g/km of Co2).
The Plant and Machinery Pool is currently written down by 20% per annum on a reducing balance basis. This is due to be reduced to 18% in April 2012. As Commercial Vehicles are generally used for business purposes, they tend to depreciate far more than 18% per annum. This means that when you dispose of a vehicle, it is worth more in the business’s accounts than it actually realizes. This shortfall used to be allowable against taxation in the year of disposal, being known as a ‘balancing allowance’. This tax relief is now delayed after disposal, with the shortfall continuing to be written down on a reducing balance basis by 20% per annum (18% from April 2012).
This has an impact on a business’s tax position, and many businesses are now considering leasing commercial vehicles, where they can offset the entire rentals against taxation during the lease period (if the business is trading as a sole trader or partnership, this may be restricted to the element of business use of the vehicle, i.e. the private use element is disallowed).
To discuss your requirements in more detail, or if you have any queries regarding any of this information, please call us now on 01653 604300
Customer Testimonials
“Thank you for yet another efficient delivery. The 2 cars arrived as promised and we are very happy with them. We are very pleased with the service and will continue to use you guys for our future car needs.”
Mr S Dodds
“Our congratulations to contracthireuk.co.uk on reaching this milestone (20 Years Trading). In a very competitive market, carleasinguk.com have remained very cost effective and have managed to retain a personal touch sadly missing in this digital age.”
Mr L Maclachlan
“I wanted to drop you a quick note to say thanks for the prompt and efficient way you have handled the order and delivery of my new car in a short space of time. I am delighted with the car and I hope to have dealings with you again in 3 years time.”
Mr M Wood
“We would like to express our thanks once again for another smooth delivery for our latest fleet vehicle. Everything was expertly handled from start to finish, as usual. Many thanks.”
Mrs T Williams
“We have just taken delivery of our latest edition to our fleet and I can't thank the team at contracthireuk.co.uk enough for the superb service levels that they provided to us once again. It is a refreshing change to have a company look after your fleet in such a well organized manner.”
Mrs S Iqbal
“I just wanted to say thank you for sourcing the right car and finance package for me. The car was delivered a week ago, and I know it wasn't the most straight forward deal to arrange. Suffice to say I am delighted with it; its exactly what I wanted.”
Mr M Bilney
“I wanted to thank you for all of your help. You are very easy to deal with and nothing was too much trouble. Keep the offers coming as we have more cars due early next year.”
Mrs J Maylor
“Many Thanks for your assistance in selecting the correct car after much searching on your behalf. The car is outstanding and the delivery was seamless. All in all, and encouraging experience”
Mr W Henry
“Thank you for all of your hard work in getting this sorted. I have been very impressed with your efficiency and willingness to help, and will have no hesitation in recommending your service to others.”
Mr C Rich
“I would like to take this opportunity to thank you for the smooth and efficient manner in dealing with our new vehicle. I have used a number of companies over the past few years, and to be honest I was very surprised by the level of service we received from yourselves, which from my experience is second to none. Every person I have spoken with have been extremely efficient and a pleasure to deal with.”
Mr M Furness
“I would like to thank contracthireuk.co.uk for their professional advice and committed customer service. Our fleet of company cars is increasing significantly over the next few months, so we will be in touch.”
Mr A Strickland
“I have recently placed my business for a new car through your company. I originally chose contracthireuk.co.uk because you provided me with the most competitive quote, but since then I have been hugely impressed with the outstanding customer care I have received.”
Mr M Wilton
Why contracthireuk.co.uk
are better than the rest
- Trading for over 20 Years
- Dedicated account managers
- Impartial funding advice
- Comprehensive maintenance packages
- Bespoke vehicle sourcing solutions
- Continual support throughout the contract
For all enquiries or further information, please call us now on 01653 604300
