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Where Taxpayers and Advisers Meet

Capital allowance on new EV Car - Advice need for specific circumstance

Posts: 1
Joined: Wed Jan 23, 2019 9:30 am

Capital allowance on new EV Car - Advice need for specific circumstance

Postby Shah2001 » Mon Jan 28, 2019 3:26 pm

I am a partner in a business (take drawings) and do Annual self-assessment – 40% tax bracket

Currently: Have a car worth about £1800 max. This is used exclusively for work/commute

I also have my own family car for the family/wife to drive.

Main Car for work: Commute to work and also do client visits.
• Client visit may be in the region of 10% - Rest 90% is for the commute to work.
• I claim very little (10% of may be £1,500 car costs = £150 max a year, plus 10% of 18% = £33)

I wanted to buy a new 100% Electric car – Cost £32,000


Initially I thought I would be able to claim that amount as capital car allowance (£32,000) as I use it all for work, but I have read that I may not be able to do that as the commute to work is not considered work, but only the 10% of the client visit is, so only 10% I could claim.

I wanted to know what would be the best and most tax efficient way to buy the full electric car.

I was thinking perhaps to buy it near the end of the financial year and then only use it for a few days of client visits only. Technically then I would have used it for 100% for business and so thought I could claim 100% for that year and not claim for the current car at all. However I recall on my PPE claims form I give to my accountant it asks for the purchase price of new car and sale price of old car and has two columns, Vehicle 1 and 2 with each asking for percentage of private use (commuting is 90% for me). Could I claim 10% on the old car and 100% on the new EV vehicle or will they pro rata this taking into account the days I used the new EV vehicle only.

Advice and help appreciated along with any debate arguments for and against.


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