By Daniel Hunter

If you are self-employed and use a motorcycle for business, you could be eligible to claim 100% tax allowance for the cost of your bike, according to Nottingham firm EBS Accountants.

“Motorcycles used by the self-employed for work can be up to 100 percent tax deductible, and some qualify for the full 100 percent,” said Jill Evenden, MD of EBS.

“Motorcycles are no longer treated like cars for tax purposes, but as plant and equipment, something that has a significant affect on the amount of tax relief that can be claimed. So the total cost of a new bike is potentially available as a tax write-off in the year in which it is purchased.”

If your preference or necessity is four wheels, then latest information from HMRC confirms that for some cars that are used 100% for business, there are significant tax allowances and savings available too.

“The allowances are calculated on the car’s CO2 emissions,” Jill said. “So for example, for a car with 95 grams per kilometre emissions, that was purchased new or unused, then you can claim up to 100% allowance in the accounting period in which it was bought. Any remaining balance, which maybe nil, goes into the main pool in the next accounting year.

“Allowances are available on a sliding scale of CO2 emissions and range from 8% per annum for cars with emissions 130g/km or over, and 18 percent for 130g/km or less.”

Jill explained that the allowances change if the same car is used for both business and private travel: “If this is the case, you can claim a proportion of the total costs.”

Jill’s advice comes as many self-employed are finalising information for their 2013/14 self-employed self assessment tax returns.

She added: “The self-employed must remember to include and claim all tax deductible expenses, such as where cash has been used for eligible items and purchases. Additionally, they should claim Annual Investment allowance, or AIA, on what are deemed as capital assets, such as laptops, office furniture and equipment, many of which can represent a sizeable investment for a self-employed worker.”

Do you use a motorbike for your business? You can email your reactions to editor@freshbusinessthinking.com

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