Winter Tyres Dilemma: Seeking Advice on Taycan Wheels

[peterjames]

hi Peter, it’s very unlikely to qualify for a 100% allowance in the first year as it was pre-registered. It’s probably VAT qualifying, but most businesses can’t claim that VAT. It’s not the end of the world, you can still claim 19% allowance every year, just not 100% immediately..

My useless accountant told me that too. To be honest, hardly anyone knows, but it's incorrect, and here's why.

This is taken from the HRMC manual CA23145...
https://www.gov.uk/hmrc-internal-manuals/capital-allowances-manual/ca23145

"What is meant by ‘unused and not second hand’?
A vehicle is unused and not second hand even if it has been driven a limited number of miles for the purposes of testing, delivery, test driving by a potential purchaser or use as a demonstration vehicle."

The website explicitly mentions 'demonstration vehicle' In the case of an ex-demo, the dealership is typically the registered keeper. In my conversation with HMRC over the phone, I was informed that it would be classified as new and get 100% capital allowance. I also inquired about the limited mileage mentioned, and I was told it should be under 500 miles. While I don't generally trust information given over the phone, I've written a letter to HMRC for written confirmation and am awaiting their response.

Nonetheless, this confirmation may not be necessary as HMRC clearly states 'demonstrator car.' To be on the safe side, it's advisable to gather as many supporting documents as possible, such as a copy of the logbook, any documentation proving it was used for test drives, and a letter from the dealership confirming these details, in case such evidence is needed in the future.

Hope it helps

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[alexsas]

My useless accountant told me that too. To be honest, hardly anyone knows, but it's incorrect, and here's why.

This is taken from the HRMC manual CA23145...
https://www.gov.uk/hmrc-internal-manuals/capital-allowances-manual/ca23145

"What is meant by ‘unused and not second hand’?
A vehicle is unused and not second hand even if it has been driven a limited number of miles for the purposes of testing, delivery, test driving by a potential purchaser or use as a demonstration vehicle."

The website explicitly mentions 'demonstration vehicle' In the case of an ex-demo, the dealership is typically the registered keeper. In my conversation with HMRC over the phone, I was informed that it would be classified as new and get 100% capital allowance. I also inquired about the limited mileage mentioned, and I was told it should be under 500 miles. While I don't generally trust information given over the phone, I've written a letter to HMRC for written confirmation and am awaiting their response.

Nonetheless, this confirmation may not be necessary as HMRC clearly states 'demonstrator car.' To be on the safe side, it's advisable to gather as many supporting documents as possible, such as a copy of the logbook, any documentation proving it was used for test drives, and a letter from the dealership confirming these details, in case such evidence is needed in the future.

Hope it helps

Yeah… looks like we have the same accountant!
Very interesting, thank you for sharing.
As for winter tyres, I bought a set of used 20” taycan turbo wheels and put winter tyres on them. (Was a little less hesitant because it’s a tax deductible expense). But I only did that because we have a few skiing trips in the winter. I would not have bothered for driving in the UK

 

[peterjames]

Yeah… looks like we have the same accountant!
Very interesting, thank you for sharing.
As for winter tyres, I bought a set of used 20” taycan turbo wheels and put winter tyres on them. (Was a little less hesitant because it’s a tax deductible expense). But I only did that because we have a few skiing trips in the winter. I would not have bothered for driving in the UK

You're welcome! I might consider buying a used car privately, leading to a higher tax payment in the 40% bracket. Despite capital allowances, the possible depreciation may outweigh the benefits. This prompts me to consider purchasing a combustion engine, eliminating all the hassles associated with an EV. Obviously, it depends on your situation, but I won't be claiming for mileage.

 

[alexsas]

You're welcome! I might consider buying a used car privately, leading to a higher tax payment in the 40% bracket. Despite capital allowances, the possible depreciation may outweigh the benefits. This prompts me to consider purchasing a combustion engine, eliminating all the hassles associated with an EV. Obviously, it depends on your situation, but I won't be claiming for mileage.

You can still buy a used electric car (that’s what we did). The only difference is that you cannot claim 100% offset for corporation tax, but 19% annually is not bad (you would still have to add the residual price to profit when you dispose the car)

 

[peterjames]

I'm concerned about how it was charged and the state of the battery, etc. While with combustion cars, I can assess the vehicle from its service history, when it comes to the battery, there's no way to determine its degradation. For example, how was it charged? Has it undergone fast charging since purchase, etc.? This lack of information is another reason why used EVs are not selling well. It also makes selling an EV even more challenging because people don't have this important information. I raised this issue at the dealership, but they couldn't answer the question.

 

[Murph7355]

hi Peter, it’s very unlikely to qualify for a 100% allowance in the first year as it was pre-registered. It’s probably VAT qualifying, but most businesses can’t claim that VAT. It’s not the end of the world, you can still claim 19% allowance every year, just not 100% immediately..

Depends who it was first registered to and for what. Ex-demo can qualify.

Though it's more a cash flow play than it is a massive saving.

 

[Murph7355]

I'm concerned about how it was charged and the state of the battery, etc. While with combustion cars, I can assess the vehicle from its service history, when it comes to the battery, there's no way to determine its degradation. For example, how was it charged? Has it undergone fast charging since purchase, etc.? This lack of information is another reason why used EVs are not selling well. It also makes selling an EV even more challenging because people don't have this important information. I raised this issue at the dealership, but they couldn't answer the question.

You're being suckered into "EV bad/ICE good" mumbo.

You have NO way of telling how an ICE engine is used between services either. An owner could rag the arse off it from cold and you would never know from the service history. They could ride the clutch, and ditto. ICE cars need to be treated so much more kindly to stay in good fettle, and yet where is all the Daily Mail moaning about them and all the pitfalls?

You could ask for compression tests, scope analysis of bores etc... But nobody does.

Equally, you can get the state of health if the battery from the dealer, or do it yourself from a cheap as chips OBD reader (doing your own compression tests on an ICE car is slightly more involved!).

If the car's only done 50 miles, how often do you think it's been charged? ?

 

[peterjames]

You're being suckered into "EV bad/ICE good" mumbo.

You have NO way of telling how an ICE engine is used between services either. An owner could rag the arse off it from cold and you would never know from the service history. They could ride the clutch, and ditto. ICE cars need to be treated so much more kindly to stay in good fettle, and yet where is all the Daily Mail moaning about them and all the pitfalls?

You could ask for compression tests, scope analysis of bores etc... But nobody does.

Equally, you can get the state of health if the battery from the dealer, or do it yourself from a cheap as chips OBD reader (doing your own compression tests on an ICE car is slightly more involved!).

If the car's only done 50 miles, how often do you think it's been charged? ?

Obviously I'm not talking about a new car with 50 miles, hence why I used the word used.

 

[peterjames]

Depends who it was first registered to and for what. Ex-demo can qualify.

Though it's more a cash flow play than it is a massive saving.

Ex demo is registered to dealership as I stated and only used for test drives.

 

[Murph7355]

Ex demo is registered to dealership as I stated and only used for test drives.

Talk to your accountant, but it could still qualify for 100% write down if that's your preference.

 

[peterjames]

Talk to your accountant, but it could still qualify for 100% write down if that's your preference.

Would, not could, as stated on the HMRC website.

 

[911GP]

I ran my previous 4s with 20” wheels and Summer tyres for two and a half years and had no issues at all.

For my GTS I have bought a set of Tequipment 20” winter wheels with winter tyres. There are reasons for this:

1) when I ran a previous Audi on the same winter/ summer tyre basis, the tyre wear was really good. I think using summer tyres in winter wears out the tyres. So overall it doesn’t really cost much more having two sets and swapping them.

2) the car is heavy and having the right tyres for the seasons is therefore better.

3) I plan to keep this car for longer.

I have noticed that the winter tyre set is very comfortable. Even my wife commented on how smooth the car felt when she drove it compared to our previous 4s.

Downsides:
1) you need to swap the wheels twice a year. I have decided to do this myself at home since it is too time consuming going to the dealer.
2) the wheels are heavy so take care when lifting them
3) they are very big so consider this when thinking about storage space.

You can of course use your dealer and get them to store the wheels too.

 

[BigBob]

Ex demo is registered to dealership as I stated and only used for test drives.

or courtesy car?

 

[f1eng]

I'm concerned about how it was charged and the state of the battery, etc. While with combustion cars, I can assess the vehicle from its service history, when it comes to the battery, there's no way to determine its degradation. For example, how was it charged? Has it undergone fast charging since purchase, etc.? This lack of information is another reason why used EVs are not selling well. It also makes selling an EV even more challenging because people don't have this important information. I raised this issue at the dealership, but they couldn't answer the question.

It is to some extent true but you can’t really assess an IC engined car much better than a battery either since you don’t know how it has been driven.
A badly driven car, particularly a manual, can have large variability in clutch wear and syncro ring wear and some engines may have been frequently red lined, even from cold, so will be much more worn than even one with no dealer service history but well driven and properly maintained at home.

So I am not sure there is much difference in one’s actual ability to judge the condition of a used IC engined car over a used EV.

Also, whilst my longest experience is with hybrid batteries, the Prius I bought in 2005 is still being used daily in the family and is still on its original traction battery so still in spec after 19 years (it needs a new 12V lead acid ancillary battery every 4-5 years though).

I think the batteries are well managed and unless they have a faulty cell may last way longer than we fear.

 

[peterjames]

or courtesy car?

I wouldn't think so, but I'm no accountant. I would just rely on what they state on the HRMC website to play it safe.

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