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Updates from the Clayton & Brewill team.
Got a classic car in the garage?
If you’re lucky enough to have an Austin Healey or an E-type Jag in the garage then be aware that HMRC is proactively checking valuations to ensure they are correct for tax purposes.
Clayton & Brewill’s Doug Perry explains:
When a classic car is valued at more than £15,000 the tax implications are substantial, with a benefit in kind percentage ranging from 15% to 32% of the value being liable to tax.
This has led to a number of classic car owners aiming to keep their valuations to below £15,000 – and justifiably so in many cases.
It appears however that HMRC are targeting owners of certain classic cars to ensure that they are not under-egging the vehicle values in order to avoid tax.
Indeed, we have heard of recent 'compliance visits' by HMRC with the specific aim of assessing classic car values for benefit in kind purposes. With the upshot being a potential revised valuation of the car and a retrospective tax bills.
The upshot was a revised valuation of the car and a retrospective tax bill going back a number of years.
Our advice?
Don't sleepwalk your way to a surprise tax bill.
Make sure the valuation and the documentation for your car(s) match up – or risk a revised valuation (and a potentially substantial bill) from HMRC.
For help or advice on how to manage assets such as classic cars in the most tax-efficient way, contact me on 0115 950 3044 or by email.
