Can someone clarify please

[Becci26]

Hiya,

Sorry have got myself in a tiz with my accounts and wondered if u could smooth it out for me!?

I bought a new car back in November, mainly for cm'ing as its an 8 seater. I want to claim the costs of the car rather than the mileage method.

Can u tell me - if the car was used 80% of the time for childminding do I claim a straight forward 80% of total costs from when it was purchased up until the end of the tax year?

It has popped into my head that perhaps I can only claim a certain amount of the 80% because I purchased it part way through the year and thus only had it for 5 months at year end (ie 80% divided by 12 then times 5) - surely this is over complicating it though...

You can see how I have got myself all confuddled - I'm blaming the baby brain!! :/

[Rick]

Can you claim the actual cost of the car, I thought only expenses in using the car. Better check that, I'm not 100%. Someone else might know.

As for other expenses car related, you would just need to keep receipts and a record of expenses since you had the car (80% of)

[Chatterbox Childcare]

As long as you are not in your first year of trading you can claim 80% of all the car costs and Capital Depreciation.

Have you looked at the HMRC to see what can be claimed and how to do CD?

[blue bear]

Do a search for some of mr a posts he Definetly a swerved this before, more complicated than I thought and I can't remember exact.

[Becci26]

Ok, thanks I will have a look later when I can get on the pc as the search is a little easier to navigate on there.

I remember reading some of mr a's threads before which is what swayed me to doing it this way but I probably need to look into it again as it was a whole ago!

[Becci26]

Oh I am so confused :(

I have been searching the threads and looked on HMRC too, so I can not actually claim the cost of purchasing the car? Only a small % of what is essentially depreciation value? But the other things I can claim 80% of?

My brain is really not working :panic::blush:

[Rick]

Oh I am so confused :(

I have been searching the threads and looked on HMRC too, so I can not actually claim the cost of purchasing the car? Only a small % of what is essentially depreciation value? But the other things I can claim 80% of?

My brain is really not working :panic::blush:

I'm pretty much sure you can't put down the purchase of the car because you can childmind without one.

http://www.childmindinghelp.co.uk/freeresources/Free%20downloads/Resources/Tax%20information.pdf

Page 7 and 8 of that thread state you can claim for car seats but no mention of the car itself there. Ongoing expenses state capital expenditures such as cars to take further advice from HMRC.

[Kiddleywinks]

Oh I am so confused :(

I have been searching the threads and looked on HMRC too, so I can not actually claim the cost of purchasing the car? Only a small % of what is essentially depreciation value? But the other things I can claim 80% of?

My brain is really not working :panic::blush:

That's correct
80% of the running costs each year (or whatever the percentage is each year), but only a percentage of the cost of the car each year

The easiest way of establishing the percentage of the running costs is to make a note of the mileage from the start, then keep track of your mileage for work and personal use.
Keep all your receipts and log them: fuel, mot, servicing, replacement tyres, etc
At the end of the financial year you make a note of the end mileage to work out how many total miles you've done, add up all work and personal mileage and establish what percentage they are.
Add up all receipts and work out what the percentage is for work, plus the depreciation allowance
Multiply work mileage by 45p and you will see if it's better to claim mileage or percentage.

Whatever you start using, you do have to continue with the same method each year until such a time as you change the car, so if you start on percentage, you stay with it.

[Chatterbox Childcare]

As others have said no you cannot write off the car in one year but you will do by claiming depreciation each year. You can't claim 80% each year unless you can prove this figure, it does fluctuate

I claim for

Deprecation
Fuel
MOT
Repairs and Maintenance
Services
Car Wash
Valeting
Interest on Loan (this can be claimed on .45p too)

I would work out both ways for your first year and decide which pays you more. Your depreciation will go down each year even if you claim 80% as the value of the car is less so in some cases the .45p a mile is a better way of claiming

[Becci26]

Yep thanks chatterbox,

All understood now thanks to the lovely help I had yesterday :) was having a day of it and got myself muddled!