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Discussion Starter · #1 · (Edited)
Now and again things change in your favour, and if possible, it's a shame not to take advantage...

This is not new news, as it relates to legislation passed in 2009 but it is still very relevant. I've just been looking into it seriously and shall stick a few details down here. If you do consider it yourself, talk to your accountant/adviser as I'm not a tax man. I'm just a business owner who is trying to get what I can from the system legally...

Simply put, motorcycles have been classified as plant equipment. So, if you run your own business in whatever form, you can purchase a motorcycle and write off 100% of it's value against year one's tax assessment. As plant equipment, it's now part of your Annual Investment Allowance. You can claim back all of the 20% VAT, and use the company to fuel it, tax and insure it. You can even use the company to buy helmet and kit as safety equipment.

This legislation could save an absolute fortune. AND it applies not just to new bikes but to used ones too!
Depending upon what proportion of the mileage you decide to declare as private, the above tax benefits are reduced proportionally.
As I understand it, when the bike/asset is sold, the sale price is to be put back into the business as a taxable profit.

Very approximate maths...
New bike cost £10,000 on the road....

To buy privately your business would have to pay you and the tax man...
about £14500 incl.standard tax and NI and company NI
about £16,000 with higher rate tax and NI.
You can claim 24p per mile expenses for business miles on a privately owned bike.

To buy via the business....with 100% business use...
New bike cost £10,000 on the road....
Claim back VAT 20%
Write it down as tax loss, 10% saving on Company Tax
cost £7200
All fuel, insurance, tax, servicing, helmet and kit paid by business - before tax

The benefit of company purchase diminishes a lot with increased private mileage to the point where it can be better to buy it yourself and claim the mileage rate.
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