PAYE to Sole Trader

[b4ugogo]

Hi I have gone employed PAYE to a sole trader mid tax year (2018/19) and i am using the cash basis accounting as my money all comes in a service based business.

My question is how to account for the car I own? - as PAYE i received mileage allowance as I owned the car outright ( I claimed 10,000 miles at 45p), going forward I do need a car for business use but use a lot less miles probably 4000 per year & 4000 personal per year. The cars value is around £8000, insurance £400 and servicing and repairs were £1000.

Do I still need to use the mileage allowance system for the remainder of the tax year?

I'm I able to use the current value of the car as an expense? would I have to wait to the next tax year?

[darthblingbling]

Claim 45p per mile as a deduction from your taxable income. 25p per mile if for business miles over 10,000

[robbob]

Do I still need to use the mileage allowance system for the remainder of the tax year?

Nope you have the normal choice available between using 45/25p a mile or using actual expenses. Note you must stick with your choice until you change cars - so if you crunch the numbers do it over the expected time left that you will own that car.

I'm I able to use the current value of the car as an expense? would I have to wait to the next tax year?

If you use actual expenses for the cars then you use the current market value - all that happens year one is that your writing down allowance claim will be reduced pro rata so the claim is only for the % of a full year that your first accounting period is for.