x-ray wrote:
One of our drivers is leasing a new TXe and he reckons he can claim it all back off the taxman, is this true ?
That's often said about this, that and the next thing but, as grandad in particular says, you can set any relevant expense against your income, but that will just reduce the amount of tax payable - it doesn't strictly mean that you'll 'claim it all back'. You can 'claim it all' against income, but you're not getting the whole cost back.
Don't think any special rules apply to the purchase of electric cars, except that you can claim more of the cost upfront, so if he was actually *buying* the vehicle then he might not have to pay tax at all for a year or two (I think), depending on his income.
But all this means is that the cost is brought forward instead of being spread over a number of years. Eg, if you had 60k in takings (
) and the cab cost 50K then you'd have taxable profits of just £10k in the first year. Normally, the cost of a car will be spread over a number of years and is front-loaded, eg £10k in the first year, £8k in the second year, £7k in the third year*, etc
But that's only if you're buying the cab outright, most obviously if you have enough ready cash in the bank to pay the whole lot
or if you're buying it via an HP agreement etc.
But if it's a rental-style lease then none of that applies, and the monthly payments are simply deducted from your income to get taxable profit, and I don't think it's any different if it's an electric cab or bog standard diesel, or whatever.
But if there are any tax advantages to *buying* an electric cab, it's largely the eventual timing of the tax payments that will differ - you'll pay less tax up front, but you'll be paying more than you would otherwise after a year or two. At the end of the day, all of the costs will be set against profits, it's just that *when* they're set against profits may vary.
*On your tax return and computation these costs will be shown as 'capital allowances' and deducted from your profit.