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Van lease/loan tax write off

  • 26-09-2016 8:27pm
    #1
    businessdit
    Registered Users, Registered Users 2 Posts: 173 ✭✭


    Hi Folks -

    My company is hoping to by a van on lease.

    Can someone advise what the best way to approach this is from a tax write-off point of view so that company can write off the payments and interest from profits?

    Finding it hard to see difference between HP, loans and lease finance

    Thanks
    Alan


Comments

  • #2
    thegolfer
    Registered Users, Registered Users 2 Posts: 346 ✭✭thegolfer


    businessdit wrote: »
    Hi Folks -

    My company is hoping to by a van on lease.

    Can someone advise what the best way to approach this is from a tax write-off point of view so that company can write off the payments and interest from profits?

    Finding it hard to see difference between HP, loans and lease finance

    Thanks
    Alan

    HP you get capital allowances, and write off the asset over 8 years at 12.5% per annum.

    A loan would provide similar results.

    Lease you write it off over the term Of The lease, say 4 years, sometimes called accelerated allowances.

    Interest in both instances are allowed as a trade deduction.

    VAT treatment in both scenarios is different.

    HP and loan you could claim VAT up front.

    Lease is over the term of the repayments.


  • #3
    businessdit
    Registered Users, Registered Users 2 Posts: 173 ✭✭businessdit


    thegolfer wrote: »
    HP you get capital allowances, and write off the asset over 8 years at 12.5% per annum.

    A loan would provide similar results.

    Lease you write it off over the term Of The lease, say 4 years, sometimes called accelerated allowances.

    Interest in both instances are allowed as a trade deduction.

    VAT treatment in both scenarios is different.

    HP and loan you could claim VAT up front.

    Lease is over the term of the repayments.


    Thanks very much for this information.

    We don't collect VAT in the company given our area of trading so won't be able to claim the VAT.

    I think the bank loan would suit my circumstances best.

    So if the van is 40,000 euro and I pay it over 5 years and can write off the payments and interest payments off profits?

    Never done this before!

    Thanks


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