Car for business use.

mickdw

Is it still the case that if you buy a low emissions car - group A or B, that you can apply a value of 24k to it for tax claim purposes regardless of actual purchase price?

Lenar3556

Where are you getting €24k from?

mickdw

That was in the tax rules for cat A or B cars from 08 onwards.

mickdw

OK it appears to still be the case where a car is bought for business use or part business use that if its in the correct emissions category (less than 140), a value of €24000 can be applied to the purchase regardless of whether car cost more or less than that figure.... amounting to 3k claim per year for 8 years or part of that if some private use also.

Lenar3556

I would be interested to see where you are getting that from?

The taxable benefit arrises from private use of the car (usually including travelling to work from an employees home). If you could demonstrate that the car was exclusively for business use, there wouldn’t be a BIK implication in the first instance.

I include below the calculation table, and link to the current tax and duty manual.

https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-01-01b.pdf

mickdw

I'm not talking about company cars to employees. I'm talking about a personally bought car while being a sole trader and the allowable tax claim when using for business or part business use.

Lenar3556

https://www.boards.ie/discussion/comment/120718141#Comment_120718141

Ok, that’s a different scenario.

My understanding is you can deduct the reasonable running costs of the car incurred in the course of your business. (Fuel, tyres, servicing etc.) excluding the cost of travelling to and from work.

As for the purchase of the car in the first instance, this wouldn’t be a business expense, so I don’t see this being of any significance. What is this €24k about, where are you getting that from?

newmember2

https://www.boards.ie/discussion/comment/120764055#Comment_120764055

Why isn't the purchase of the car a business expense?

callaway92

‘I’d love to buy a new car. Let me see if there’s a way I can get one cheaper’

mickdw

It is. You can allow your business portion as a capital expense, depreciated over 8 years.

Bass Reeves

Usually it's a 2/3 business to 1/3 personal use split for tax purposes

Really interested in this 24k for low emission cars. I remember hearing it before and it was suggested you could buy even a second hand car with low emission and draw the relief.

https://www.boards.ie/discussion/comment/120825628#Comment_120825628

Where do you get the 2/3 vs 1/3 split Bass? Acceptable rule of thumb? What if someone is only using their vehicle on a 50/50 basis, or less?

Bass Reeves

https://www.boards.ie/discussion/comment/120881191#Comment_120881191

Its justifable use you put in. If you are doing a nice bit with your vehicle the generally an accounty will put it in 2/3 business use