For business or pleasure? That’s a question you still get asked at customs desks around the world but it should also be a question we ask ourselves whenever we roll up to a car dealership.
As with everything in the car yard or showroom, there are pros and cons and this is especially true of the question, “should I buy my next car in my company name, or my personal name?”
The short answer – it depends. The more useful response is to ask yourself what the car is being used for. If your answer is something along the lines of “I will be using the car for work: getting to meetings, picking up stock, deliveries…” there is only one answer: YES. And yes, it’s all in capitals. To be clear, if your answer was yes, stop reading and move onto signing that paperwork.
No wait. Come back. Let’s look at the slightly longer answer which is made up of a number of short questions.
December before last I bought a 2015 Ford Ranger to say, “well done Ben, that was a great year…” or something like that. Happily, 1/11 or 9.09% of all new vehicle prices are made up of GST. (Small businesses can claim that sum of money the moment you finalise the purchase by either by paying for the car upfront or confirming your finance arrangements with a bank – they pay for the car in full, for you.) So I bought my car in December 2015 and within 3 weeks I had submitted my BAS and claimed the GST which took care of the first few repayments as well.
GST can work for you as well and that is something to be considered when you are thinking about registering your new vehicle for company or private use.
Of course everybody’s circumstances are different but by and large there are only two rules to remember: if you use your car for business, your registration should reflect that and secondly, get on the phone or flick an email to someone that understands how best to put money back into your business.
Why not test drive an accountant today.
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