Hi folks,
Apologies for the long-winded setup here... I'm considering buying a company electric car at the moment. I'd like to be invoiced and/or pay for the car during the current tax year to take advantage of the Accelerated Capital Allowance allowed on electric cars (ACA: claiming the full €24,000 capital allowance in year 1 of purchase, rather than depreciating it over 8 years) and take delivery of the car in early 2019. I'm not au fait with company car accounting or corporation tax, so I don't know if that's legit.
My problem is that the garage initially told me the invoicing would be all grand, but then changed their mind and said an invoice would only be issued when the car is registered i.e. 2019. My company accounting year ends on 31st December, so I can't carry over funds in my company waiting for this 2019 invoice without incurring corporation tax on what's being held, as far as I understand it, and I'd want to avoid that. The garage has offered to give me a pro forma invoice now, to be followed by an actual invoice in 2019 after car registration.
From what I read, VAT is not reclaimable on pro forma invoices, only on the actual invoices, however VAT isn't reclaimable here so I don't think that's an issue. I think the only question is whether a pro forma invoice can be accounted for in 2018 and if it allows me to claim the ACA in 2018 to reduce the corporation tax bill. It's been suggested to me that if the pro forma invoice is paid within 2018, then I can put it in the accounts.
I can't find anything useful about this online and I'm awaiting an update from an accountant about it, but it occurred to me to ask here if anyone here has concrete knowledge about it because even the accountant sounded unsure
Thoughts appreciated!
Apologies for the long-winded setup here... I'm considering buying a company electric car at the moment. I'd like to be invoiced and/or pay for the car during the current tax year to take advantage of the Accelerated Capital Allowance allowed on electric cars (ACA: claiming the full €24,000 capital allowance in year 1 of purchase, rather than depreciating it over 8 years) and take delivery of the car in early 2019. I'm not au fait with company car accounting or corporation tax, so I don't know if that's legit.
My problem is that the garage initially told me the invoicing would be all grand, but then changed their mind and said an invoice would only be issued when the car is registered i.e. 2019. My company accounting year ends on 31st December, so I can't carry over funds in my company waiting for this 2019 invoice without incurring corporation tax on what's being held, as far as I understand it, and I'd want to avoid that. The garage has offered to give me a pro forma invoice now, to be followed by an actual invoice in 2019 after car registration.
From what I read, VAT is not reclaimable on pro forma invoices, only on the actual invoices, however VAT isn't reclaimable here so I don't think that's an issue. I think the only question is whether a pro forma invoice can be accounted for in 2018 and if it allows me to claim the ACA in 2018 to reduce the corporation tax bill. It's been suggested to me that if the pro forma invoice is paid within 2018, then I can put it in the accounts.
I can't find anything useful about this online and I'm awaiting an update from an accountant about it, but it occurred to me to ask here if anyone here has concrete knowledge about it because even the accountant sounded unsure
Thoughts appreciated!