Are interest-free or interest based monthly repayments for a vehicle considered as motoring costs that can be claimed under the full cost method?
Arthur Weller replies:
See www.kfaccounting.co.uk/claiming-business-motor-expenses/ which explains the full cost method. It is applicable in the case of a sole trader where he uses his own car for business. If so, the leasing costs/monthly repayments are personal costs, and he claims: (a) fuel; (b) repairs and MOT; (c) insurance, tax and breakdown cover; and (d) tax capital allowances as business allowable expenses - less a deduction for any private use element.
This question was first printed in Tax Insider in May 2017.