Bikes as company vehicles

[ceebie13]

My new CB13 was bought through my business. ie: The invoice was made out to my business name. Basically the business is just me as a freelance sole trader. Has anyone else done this? If so what can I expect to claim and what not as regards expenses and operating costs etc. For example can I claim all the GST back or only part of it? Naturally, the bike is going to be used for private use aswell (I mean.. lets not pretend otherwise!!) so will I have to keep a log of all the mileage?? Yawn! It could get a bit complicated!
What thoughts people?

[MrMelon]

I didn't think you could legally claim costs from having a motorcycle as a company vehicle. Someone who knows what they're on about might need to back that up though.

[ceebie13]

I didn't think you could legally claim costs from having a motorcycle as a company vehicle. Someone who knows what they're on about might need to back that up though.
Well my accountant didn't baulk at the idea when I asked her if I could go ahead and buy it. Guess I'll quizz her abit more before I claim the GST.

[Motu]

I've never claimed a bike as a company vehicle,or insured one under my business.....but I did claim GST on my last bike by getting a receipt made out to my business.A mate of mine does it backwards - he has a (non existant) bike under his name as his private motor vehicle,and that way he claims both his work van and private panel wagon as work vehicles.

Oh,and your business vehicle will depreiciate,so it will end up owing you peanuts - but when you sell it you will taxed on the profits....heh,heh.

[ManDownUnder]

Oh,and your business vehicle will depreiciate,so it will end up owing you peanuts - but when you sell it you will taxed on the profits....heh,heh.


Yeah but... sell it to me for peanuts (no profit) and I'll sell it for the rightful value and use those profits to ... buy a bag of chips of him... or somethin'...

[Big Dave]

The Buell is my Business vehicle - 100% deductable.
The Thunderbird is for private use.

[Ixion]

I am not an accountant. But, as far as I am aware (and I have checked) there is no reason why a motorcycle will be treated any differently to a cage, as a company vehicle. Apart perhaps from some argument about the appropriate rate for mileage.If they ever got that deep into it.

After all, think about motorcycle couriers. It would obviously be manifestly unjust if they were unable to claim their motorcycle as a business expense. Because it is.

You will need (in theory) to be able to show that it is actually used for business purposes (visting clients etc).

You can either treat it as a private vehicle and claim a GST and tax allowance for business use of a private vehicle; or the other way round have it on the company books and pay a private use of business asset charge for your private use (if a sole trader) ; or pay FBT if a company.

Either way, there is lots of info and examples on the IRD website.

But basically, it's just the same as a car. Indeed , if you just put it on the books as , say, Honda, 1300cc, the IRD will assume it IS a car.

[sels1]

If you are using it for your business it is as deductable as any other "tool of trade". You will have to keep a log of your private running and divy it up when you do your tax return. Talk to your accountant. Another option is to just claim the kms you do for business use at the IRD rate, I think for a 1300cc vehicle its around 60c per Km. Either way if you use it for both purposes you will have to log one of them

edit: damn ixion - posted that while I was typing....:)

[Ixion]

,, Either way if you use it for both purposes you will have to log one of them

,

Unless you are a company and pay FBT on it. Don't need to log it then, though you might want to if you don't do much private use, there are a few tricks that can reduce the FBT liability. See your accountant, but shut the door first.

[Swoop]

My work wants me to travel to the Coromandel for some visits...
I'm going to suggest that I use my own transport and claim back the mileage at the standard 62cents/km.

I have no idea why I want to do this rather than driving aroud in a van...:innocent:
(plus the fact of being PAID to do the Coro GP is a bit of a giggle!)

[dnos]

Im an accountant and here is my advice.

this is assuming you are a sole trader.

If the vehicle is more than 50% business use then you claim all the gst - if its less than 50% business use you claim none.

You will need to keep a log book to figure out how much business and private use you do.
There is a fancy calculation called the 24% method which should apply. Claim all the running expenses and this calculation will tell you how much of the expenses to dissallow each gst period and income tax year- it is a pain so ask your accountant but it is bloody brilliant cos you end up claiming more than you probably should but the IRD set this rule and it works. You also claim a percentage of the depreciation (the business portion) but as said above when you sell the bike there may be some depreciation recovered - unlikely with motor vehicles.

Like i said it is complicated so get your accountant to do it.

Any more advice maybe send me a pm and i will try help ya out

[The Pastor]

I think you can say its part of your working contract that you get a company car and have free full use over it? I.e therorecticly (sp ok I know I know,) You're losing out on some salery? That way you can claim all gst/anything else?

[ceebie13]

Im an accountant and here is my advice......
.....any more advice maybe send me a pm and i will try help ya out

What a fine man... cheers dnos. I'll point your statements at my accountant and see where I get! :rockon:
Indeed thanks to you all for your comments. Any more to add...feel free.
Rich. (er... that's my name, not my financial status!)

[What?]

And make sure your insurance company knows it is a business vehicle.

[Timber020]

My last 3 bikes have been brought and run as business vehicles, and in all honesty it is totally used for business related trips. I do about 250kms a week on it around wellington doing quotes, picking up gear, misc errands etc. This doesnt mean I dont visit friends on my way home, or take the shortest routes everywhere. But it all works out in the end.
My bike saves me about 2 hours of sitting in traffic a week as well as costing SFA to run (250kms out of my last tank where as my truck gets barely over 300kms from 60L of diesel)

There has to be some advantages to running your own business!

[HenryDorsetCase]

There has to be some advantages to running your own business!

amen to that. after today I cant think of any.... but yeah.

[shafty]

Don't ya love it when the rules work for Bikers?!! Ceebie13, I have the perfect rego plate for you: CO.CAR (Company Car) - I had it on my 900 Triumph, as my (then) comapny was indirectly paying for my riding! Seriously for sale, PM me if it's of any interest

[Insanity_rules]

If you keep a Log book for 3 months every 2 years to justify the percentage you claim it'll give you an idea if its worth it. If its over 70% business its worth claiming full expenses (ie running, gst ,gear). If not then claim on a mileage calculation of work use (X cents per work kilometre).

I've done the exercise. I claim all expenses on my car and mileage on the bike(when I get to use it). Ah good ol Mr Tax man! God love em.

[Big Dave]

amen to that. after today I cant think of any.... but yeah.

I start work at the crack of lunchtime.

[crazybigal]

hahaha never heard of anyone doing that!
but you could invent a reason why it is used as a business vehicle.
you can claim the gst and depreciation in your tax, but remember you will have to pay the gst back and tax on what you sell it for later!
id be thinking hard if its worth doing.
i wonder if anyone has leased a bike and claimed the cost of the lease???:innocent: :innocent: would be a better idea



My new CB13 was bought through my business. ie: The invoice was made out to my business name. Basically the business is just me as a freelance sole trader. Has anyone else done this? If so what can I expect to claim and what not as regards expenses and operating costs etc. For example can I claim all the GST back or only part of it? Naturally, the bike is going to be used for private use aswell (I mean.. lets not pretend otherwise!!) so will I have to keep a log of all the mileage?? Yawn! It could get a bit complicated!
What thoughts people?

[degrom]

Can't you buy your bike on a lease agreement? Then it's not an asset and you can free up the cash that you wanted to spend on the bike and still get GST back for your expense on the lease agreement.

What will cost less to bay back?
A depreciated bike or a bike after a lease agreement?

Was just wondering,cheers.

[Ixion]

You can buy it on a lease just like any other motor vehicle. Whether that's better or not depends on your capital versus cash flow position.