Monkey boy acquired a van 5 years ago in his ltd company and claimed 100% capital allowances on the ''invoice value''.
Turns out its an operating lease and no CAs should be claimed but should have a monthly hire charge in the P and L.
We are doing accounts for the first time
Which option please
a/ Write to HMRC and ask them to change the last 5 years tax calcs, with a note of why.
b/ as above but send in new comps and returns as well
c/ dispose of the van in this years accounts for a figure which balances against the operating lease payments that should have been claimed so overall the expense claim is correct its just a timing issue.
My other worry is... maybe there is a 4 year time limit and maybe they wont change the CAs in year 1 but allow the lease payments years 2- 5 and option c is shooting yourself in the foot? As potentially double tax relief?
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