Tax relief on low tax band diesel cars?

Insp. Harry Callahan

Hi I was thinking of buying a diesel car before end of the year, I remember my accountant mentioning a few months ago that from 08 onwards, if a car was in a low tax band that it could be fully written off in the farm accounts, same as a tractor, over a number of years, up to the value of 24000,
Did I pick this information up correctly?,
What is the upper limit of tax band for this yo happen?
Anyone have any info on this?
Thanks

Timmaay

Capital Allowances on Motor Cars.


The new measures brought in this July to improve the carbon footprint of all of us, don’t just effect how much we pay for our cars and the road tax on them.

Depending on the category they fall into, a farmer buying a new car for his business may or may not be able to write off its full value.

Example 1.

Joe buys a new car for his farming business on 1st September 2008 at a cost of €22,500. It is a category B car. He is allowed write off €24,000 as this is the rate set for any category A B and C car regardless of its new cost.

Example 2

Mary buys a new car for her farming business on 1st September 2008 at a cost of €28,500. It is a category D car. She is only allowed write off €12,000 as this is the rate set for any category D car regardless of its new cost.

Cars falling into category F and G have zero allowances available.

source :http://www.mcdowellaccountants.ie/tax-tips-for-farmers/

Got my eye on a nice 08 or 09 BMW 325d coupe but can't justify the cost ha, some day!

Insp. Harry Callahan

Does it have to be a new car?

So if I buy a car in low tax band for say 10000, I can write off 24000 of tax?,doesn't sound right but if so it's a good deal

I like the look of a skoda yeti 1.6 diesel but they are not the cheapest to buy, I quite like the new type fabia also

rathbeg

Insp. Harry Callahan wrote: »

Hi I was thinking of buying a diesel car before end of the year, I remember my accountant mentioning a few months ago that from 08 onwards, if a car was in a low tax band that it could be fully written off in the farm accounts, same as a tractor, over a number of years, up to the value of 24000,
Did I pick this information up correctly?,
What is the upper limit of tax band for this yo happen?
Anyone have any info on this?
Thanks

hi I had the same discussion with my accountant and he said the same even if you bought a car it must be in the A B or C emissions category for 1000 euro as long as it passes NCT it now has a value in the books of 24000 euro to be writen off over 8 years as long as it is a farm car. If it is for personal use you can claim a % of it depending on the amount used on the farm
That was my take on it anyway

keep going

rathbeg wrote: »

hi I had the same discussion with my accountant and he said the same even if you bought a car it must be in the A B or C emissions category for 1000 euro as long as it passes NCT it now has a value in the books of 24000 euro to be writen off over 8 years as long as it is a farm car. If it is for personal use you can claim a % of it depending on the amount used on the farm
That was my take on it anyway

If you bought a car 3 years ago can you still claim it

rathbeg

keep going wrote: »

If you bought a car 3 years ago can you still claim it

Yes no problem but if you pay 15k for a 3 year old car you benifet a 9k windfall
if you pay 20k for it you only get a 4k windfall
if you pay 24k you get no windfall at all as you have spent the full 24k and this is claimable anyway even if it is a fuel gussler. The cheaper you buy the car the more you benefit
I know I am not explaining it great but hope you can get it

rathbeg

keep going wrote: »

If you bought a car 3 years ago can you still claim it

sorry I misread your post no is the answer
you have to buy the car

cute geoge

I cant get this?
I presume you have to buy a new car
If you buy a new car for 15k you get tax relief for 24k over 8 years?

Timmaay

cute geoge wrote: »

I cant get this?
I presume you have to buy a new car
If you buy a new car for 15k you get tax relief for 24k over 8 years?

Nope, doesn't have to be new. The greens brought in this tax incentive, it wasn't thought through very well 2bh ha. Actually does anyone know can it be claimed twice if your in a partnership? My folks already have a car under it, I'm a farmer so obviously am currently driving a 15yr old gas guzzing planet distroying car, can I upgrade also ha?

Timmaay

rathbeg wrote: »

Yes no problem but if you pay 15k for a 3 year old car you benifet a 9k windfall
if you pay 20k for it you only get a 4k windfall
if you pay 24k you get no windfall at all as you have spent the full 24k and this is claimable anyway even if it is a fuel gussler. The cheaper you buy the car the more you benefit
I know I am not explaining it great but hope you can get it

How is the car claimable anyway? At best you would ordinarly be only able to right off a % of it if you can prove you need it in part for business use. Whereas this 24k incentive is regardless of if the car is for fully yourown private use or for farm use. That's my understanding of it.

rathbeg

Timmaay wrote: »

How is the car claimable anyway? At best you would ordinarly be only able to right off a % of it if you can prove you need it in part for business use. Whereas this 24k incentive is regardless of if the car is for fully yourown private use or for farm use. That's my understanding of it.

as far as I can make out the 24k is only if it is a farm car and you have another family car for personal use . If it is the sole car then a % can be claimed

rathbeg

Timmaay wrote: »

Nope, doesn't have to be new. The greens brought in this tax incentive, it wasn't thought through very well 2bh ha. Actually does anyone know can it be claimed twice if your in a partnership? My folks already have a car under it, I'm a farmer so obviously am currently driving a 15yr old gas guzzing planet distroying car, can I upgrade also ha?

no idea

rathbeg

cute geoge wrote: »

I cant get this?
I presume you have to buy a new car
If you buy a new car for 15k you get tax relief for 24k over 8 years?

as far as i know but i'm not 100% in can even be pre 08 if it is imported with an emission rating A B or C

Timmaay

rathbeg wrote: »

as far as I can make out the 24k is only if it is a farm car and you have another family car for personal use . If it is the sole car then a % can be claimed

I don't think so, we have always had a farm jeep, my parents got the relief on theirown person car. We didn't even know about this relief at the time, our accountant had it included in the accounts the end of year ha.

rathbeg

Timmaay wrote: »

I don't think so, we have always had a farm jeep, my parents got the relief on theirown person car. We didn't even know about this relief at the time, our accountant had it included in the accounts the end of year ha.

maybe your car in the partnership is the personal car ?
but I may be wrong I heard about it ,looked into it a bit to suit my own farm and that was about it

Insp. Harry Callahan

If you where to buy a car for say 20,000
and it fitted in the right criteria
over 8 years if in the high tax bracket would save around 11,000 and in the lower tax bracket 5,500?

I have an 8yr old pickup already, was going to give it to the old fella to drive, maybe get a car myself if this can work out, maybe justifying the 100% farm use could be an issue?

If you are car registered could you claim any vat back on purchase or I think maybe this only applies on commercial vehicles

Wes Palmer Lee

Insp. Harry Callahan wrote: »

Hi I was thinking of buying a diesel car before end of the year, I remember my accountant mentioning a few months ago that from 08 onwards, if a car was in a low tax band that it could be fully written off in the farm accounts, same as a tractor, over a number of years, up to the value of 24000,
Did I pick this information up correctly?,
What is the upper limit of tax band for this yo happen?
Anyone have any info on this?
Thanks

My Accountant didn't entertain this at all when I put in for CA on the new car I purchased in 2014....he made a reference to Carlsberg not doing my tax returns!
Only on fuel / mileage where the farm is fragmented he said.

rathbeg

Wes Palmer Lee wrote: »

My Accountant didn't entertain this at all when I put in for CA on the new car I purchased in 2014....he made a reference to Carlsberg not doing my tax returns!
Only on fuel / mileage where the farm is fragmented he said.

no offence or anything but your accountant is useless, uninformed or working for the tax man . You need anew one

Wes Palmer Lee

I told him that the car was purchased for use in relation to my farming activity (I am also employed PAYE) but that's what he told me.
My 2014 returns are submitted now but I'm going to double check that. Not to doubt your word.

rathbeg

Wes Palmer Lee wrote: »

I told him that the car was purchased for use in relation to my farming activity (I am also employed PAYE) but that's what he told me.
My 2014 returns are submitted now but I'm going to double check that. Not to doubt your word.

My brother farms and also is PAYE , he has an 2011 golf which he sold to me and rebought it and got the full 24k allowence

keep going

Wes Palmer Lee wrote: »

My Accountant didn't entertain this at all when I put in for CA on the new car I purchased in 2014....he made a reference to Carlsberg not doing my tax returns!
Only on fuel / mileage where the farm is fragmented he said.

followed this up myself and got the accountant to do a bit of digging and managed to knock a slice off my tax bill with it so its there allright .in our case we only claimed 2\3 for the farm

rathbeg

keep going wrote: »

followed this up myself and got the accountant to do a bit of digging and managed to knock a slice off my tax bill with it so its there allright .in our case we only claimed 2\3 for the farm

result

BPH35172

I would caution anyone who thinks they can buy a €24000 tax band a/b/c motor, sell it and buy a banger, and claim 24k in tax credits. It don't work that way.

Read the claim form from revenue. (Sorry can't post link)

keep going

BPH35172 wrote: »

I would caution anyone who thinks they can buy a €24000 tax band a/b/c motor, sell it and buy a banger, and claim 24k in tax credits. It don't work that way.

Read the claim form from revenue. (Sorry can't post link)

no you cant do that but you can buy a AorBclass car for ten k but claim 24 over 8 years or a portion of same

Wes Palmer Lee

Can someone put up the link that shows this allowance on the Revenues page ?

Brown Podzol

Wes Palmer Lee wrote: »

Can someone put up the link that shows this allowance on the Revenues page ?

Worked example at the end of the page.

http://www.revenue.ie/en/tax/it/forms/claim-car-expenses-capital-allowances.pdf

More here.

http://www.farmfile.ie/taxationcapitalmotor

BPH35172

keep going wrote: »

no you cant do that but you can buy a AorBclass car for ten k but claim 24 over 8 years or a portion of same

The only way you can claim capital allowances of €24000 over 8 years is if the purchase price of the vehicle (a/b/c) is 24k or more.

Brown Podzol

BPH35172 wrote: »

The only way you can claim capital allowances of €24000 over 8 years is if the purchase price of the vehicle (a/b/c) is 24k or more.

For vehicles in bands A, B and C the allowable cost for capital allowances purposes is €24,000 irrespective of actual cost.

BPH35172

Brown Podzol wrote: »

For vehicles in bands A, B and C the allowable cost for capital allowances purposes is €24,000 irrespective of actual cost.

My apologies to all. You are right - I got this from revenue guidelines .....

Cars are categorised by reference to CO2 emissions, and are consistent with emission bands applicable under the VRT system. There are effectively 3 categories of cars to which different capital allowances arrangements apply:
 The first category covers cars with emissions of up to and including 155 grammes of CO2 per kilometre driven. For cars in this category, the car value threshold or limit of €24,000 applies regardless of the cost of the car. This means that in the case of low emissions cars, capital allowances of €24,000 are available even if the car costs less than that.

Wes Palmer Lee

Thanks Brown Podzol that all looks applicable to my situation..

porterhole

keep going wrote: »

no you cant do that but you can buy a AorBclass car for ten k but claim 24 over 8 years or a portion of same

Does this apply to farmers only or is it all self employed?

porterhole

keep going wrote: »

no you cant do that but you can buy a AorBclass car for ten k but claim 24 over 8 years or a portion of same

Does this apply to farmers only or is it all self employed?

rathbeg

porterhole wrote: »

Does this apply to farmers only or is it all self employed?

I dont know to be honest

nhg

An old thread but just wondering if this Tax Relief still applies...

Does the car have to be diesel or will it work for petrol cars within the emissions threshold - I know that petrol cannot be used as a business expense but diesel can.

Its not for a farmer but for my uncle who has both a commercial and residential rental property - car needed to do maintenance etc - therefore a business expense...

Shauny2010

it still exist for Electric cars only now, but theirs a Nissan N200 Electric van that might suit some
https://www.nissan.ie/vehicles/new-vehicles/e-nv200.html