Anybody clued up on tax/self employment?

Ryster

Paid Member
Just wondered if anyone could help? My mate is in the same boat as me, works for a company but has registered himself as self employed. Hes turned up in an audi a6 black and is paying next to nothing on it on a business lease. The lease company only asked for proof he has a business so he gave them his own gas safe number and a letterheaded letter.

Now he does the odd job at weekends and i do the same. A boiler every month or so, he says this is enough to register self employed as he is doing paid work but is under a threshold of earnings so doesnt need to be vat registered.


Can anyone tell me if this is correct? Im a gas fitter and have my own gas safe as well as my works so could i just get business lease and be wading around in a silly car for next to nothing, or would i be likely to have a taxman coming after me?

any help is appreciated as im now sat looking as audis and.mercs for next to nothing a month!
 
You'll only need to prove it to the tax man if you're claiming it as a tax offset.

In which case, you'd find it bloody hard to argue that. A van...yes. An A6, no.
 
You'll only need to prove it to the tax man if you're claiming it as a tax offset.

In which case, you'd find it bloody hard to argue that. A van...yes. An A6, no.


Id certainly agree greed with the second statement. If I got a lease and the didn't claim any mileage or fuel expenses back, would that potentially be ok?
 
I don't think its a simple as your mate is saying.

Just had a quick Google about the tax implications and basically I got as far as " If you lease a car through your business, you will have to pay Company Car Tax (or Benefit In Kind Tax as it is also known), as some of your mileage will be classed as for personal use."

I would consult an accountant.
 
I don't think its a simple as your mate is saying.

Just had a quick Google about the tax implications and basically I got as far as " If you lease a car through your business, you will have to pay Company Car Tax (or Benefit In Kind Tax as it is also known), as some of your mileage will be classed as for personal use."

I would consult an accountant.

I think Pete is correct in that you would incur costs through your personal tax code as its classed as a perk. As its a lease car In not sure on the situation with regards to claiming depreciation. Not being VAT registered means you wouldn't see the benefit of offsetting the VAT costs of running it and leasing it. Also worth pointing out that the price given on leasing sites is usually ex vat so stick 20% on any price you see.
 
Also worth pointing out that the price given on leasing sites is usually ex vat so stick 20% on any price you see.

I found that out on the M135i leases a few months back, but the prices are still better than normal 'personal' leases.
I can already see this would be potentially very risky without proper advice, and on that basis I would just pay for a personal lease. I don't do enough work on my own, or see it as worth it to pay for an accountant to tell me everything I need to do and know just to get a snazzy car for £100 a month cheaper. Easier paying the normal price and be safe in the knowledge the taxman isn't going to put a letter through my door asking me to pay back a stupid amount of money.


Thanks for the input guys, think I will just let my pal carry on tbh
 
If you use the car for personal and business you normally can get half the VAT back. So in your friends case if he is paying no vat then he is committing fraud I believe. What he wont have to pay is the ridiculous tax rate you pay when you normally get a company car as he is under the threshold so doesn't have to declare
 
surly you just employ an accountant and ask them how much you can screw the system?

my friends have their own business (hair extensions) and their accountant just tells them when they need a car and they got a merc amg softop thing.