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03 May, 2012

We are thinking of buying two Toyota hi lux 4x4 cabster pick up trucks through our vat registered company. What would be the tax liability for the company and what would the tax liability for the individual both are 22% tax payers. Kind Regards

Good morning Phil Thank you for your enquiry. The business can claim the VAT back on the purchase price (which should be restricted by any private use element) and then claim writing down allowances on the capital cost (assuming you purchase and not lease the pickups). You may be able to claim 100% write down in year one through your Annual Investment Allowance which is £100,000 this financial year. For the drivers, there is a fixed £3,000 annual taxable benefit for private use, plus a further £550 if there is any private fuel provided. Assuming there is private fuel, this gives a total benefit of £3,550 which for a 20% tax payer gives a charge of £710 per annum (this is the actual amount of tax paid by each individual for the private use of the vehicle and private fuel). As always, you should check this out with your Tax Inspector before committing to obtaining these vehicles. You may want to consider Contract Hire instead of purchasing the vehicles, in which case you can offset every rental against your company's tax position. This will not affect the drivers' tax position.

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Andy has worked in the motor trade and more specifically been involved in supplying finance for vehicles, coming up to 20 years. He started his own business www.autorama.co.uk in 2004 selling used vehicles before expanding the company via its comercial vehcle leasing business in 2006. Back then the leasing business was pretty much just him, a laptop and a portakabin. Now just six years later Autorama through it's online brands vanarama.co.uk and pickuptrucksdirect.co.uk is recognised as the largest independant commercial vehicle leasing broker in the UK.

The last six years have seen continued growth and resulted in the company now employing 32 staff. Being able to offer some of the most competative rates in the country as well as industry leading levels of customer service have played a big part in our growth. However it is our ability and moreover our expert knowledge in this sector that has allowed us to best advise and therefor better serve our customers.

Every customers needs are different and there are so many options available that it's easy to see why people get confused by either inaccurate or simply poor advice. We are here to help and advise you so whatever your query, no matter how big or small your business or how complicated your situation seems. let us answer your van leasing questions.

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