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Sorry but if it registered it's second had/used, if the price is right and you like it etc etc
Good evening,
I would be grateful for some advice. There is such a wide breadth of experience on this forum that somebody might know the answer to my question. Even signposting me to the right direction would be very helpful.
I've had a limited company for a few years and have built up some spare funds. Friends with limited companies have been advising me to buy an EV but I never really bothered as I didn't need a new car. However, it appears that the time has come to look into a purchase as my car is over 100k and starting to cost me expensive repairs. I've found a great Ex-Demo with 1200 miles on the clock and available for a substantial discount of £8K off a new car. It's nothing extravagant, just a Hyundai Ioniq.
The HMRC Document CA23153 states that:
Businesses of all sizes can claim 100% FYAs on capital expenditure on a car provided that:
the car is ‘unused and not second hand’, and is first registered on or after 17 April 2002;
it is an electric car or a car with qualifying CO2 emissions of not more than a specified amount;
the expenditure is incurred between 17 April 2002 and 31 March 2025; and
the expenditure is not excluded by the general FYA exclusions, see CA23113.
and:
New cars are ‘unused and not second hand’. You should accept a car is unused and not second hand even if it has been driven a limited number of miles for the purposes of testing, delivery, test driven by a potential purchaser, or used as a demonstration car.
I cannot for the life of me find what 'limited number of miles' mean and when asking multiple dealers, the demonstrator cars are registered to them as the first owner. I would have thought that there was a special category for registering demonstrator cars but it doesn't look like it. So I'll be the second owner on the V5 and I am not sure how this fits in with the above.
The HMRC website really doesn't help and the person on the general helpline really couldn't give me with a definite answer.
Thanks.
Andy
Sorry but if it registered it's second had/used, if the price is right and you like it etc etc
It’s quite simple - an ex demo is a used vehicle
If you want to benefit from the tax breaks then buy new - you will get a better value deal for something in stock of course but not registered
That's at ods with paragraph OP posted.Originally Posted by mk2driver
Yes, that is what confused me. They do mention 'demonstration car' specifically but it still seems rather ambiguous to me. No mention of exact mileage that would be deemed acceptable.
Youtube tonight showing examples of 25% discount on brand new Peugeot 2008 type EV. Dealers cant shift them. As stated above go new for tax purposes but shop around.
Dont particularly like this guys presenting skill but if content is valid then some savings to be had
https://youtu.be/bsk2tTJ9GoM?si=jrNarY0qUiRxgDZv
Last edited by higham5; 15th February 2024 at 22:56.
Two things which might help.
First, used EV prices are through the floor and dealers want rid, so if you identify what you want you can then search the OEM used approved website, find all the examples nationally and email all those dealers with a frankly insulting offer. Good chance one of them takes it.
Second ex demo cars are used cars, absolutely. If a car has been registered to another person or organisation before you buy it, you're second owner, even if it has one mile on the clock.
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You can still depreciate it fully just not all in Year 1 if it isn't new.
Having a company car is fine but if you don’t have private insurance you’ll loose all your ncd after 2 years
As you have said not clear. You have asked them on the helpline. If I were you I would claim the 100% fya and leave it at that.
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To be unregistered, a brand new, unused demo car may be a car driven around on trade plates by the dealership staff, or on private land by the customer - e.g. a testing facility or track.
I have bought 2x dealership demo vehicles in the past and both have been pre-used, 2nd owner vehicles registered to the showroom business.
I guess for tax purposes, an unregistered vehicle thrashed at a test track or driven badly around a 4x4 assault course classifies as new, but the showroom demo does not.
I kept my NCD after I bought out my company car and demonstrated clean driving history with my company car.
So did I.
Thanks everyone for taking the time to reply.
Other than biting your company money, I can not think of a more cost effective way to get rid of it. There must be better ways to use the money?
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Yep, I'm now having 2nd thoughts about an EV but I will eventually need a replacement car.
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