Car lease rental restriction
Any expenditure analysed on Profit and loss as Car lease rental restriction will be listed here.
To see and amend the restriction relating to expenditure shown on the list, highlight the relevant row and click Edit.
This will open Car lease rental restriction for that item.
| Income/expense type | Populated from Profit and loss as Car lease rental restriction. |
| Description | Populated from Profit and loss; the Description you entered on the P&L Analysis window will appear here. |
| Business activity | Populated from Profit and loss; the Business activity you chose on the Analysis window will appear here. |
| Allocated from P&L account | Populated from Profit and loss; what you entered as the adjustment to profit on the Analysis window will appear here. |
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Leases on cars under CO2 threshold: Payments/(rebates) |
Enter the amount shown in Allocated from P&L account which relates to a lease taken out after 31 March 2009 on a car with the CO2 emissions not exceeding the CO2 threshold at the start of the lease. The threshold is:
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| Leases on cars over CO2 threshold: Payments/(rebates): | This figure is calculated as the amount in Allocated from P&L account which has not been entered under either Leases on cars under CO2 threshold or Pre 01/04/2009 leases. |
| Maintenance costs | Enter the amount entered under Leases on cars over CO2 threshold: Payments/(rebates) which relates to a maintenance contract, rather than car rental. This amount is disregarded in the calculation of the rental restriction. |
| Net leasing payments/(rebates): |
This amount is calculated as: Leases on cars over CO2 threshold: Payments/(rebates), less Maintenance costs. |
| Amount disallowable/(non-taxable | The disallowable amount is 15% of Net leasing payments/(rebates). |
| Pre 01/04/2009 leases: Payments (rebates) | Enter the Allocated from P&L account amount which relates to leases beginning before 1 April 2009. |
| Amount disallowable/(non-taxable) | Enter the amount by which the payments at Pre 01/04/2009 leases: Payments/(rebates) are to be restricted. See Calculation of restriction of hiring cost, below, for details of the restriction calculation. |
| Total disallowable/(non-taxable) |
The total by which the car lease payment expenditure is restricted. This figure will increase the profit (or decrease the loss) of the activity selected at Business activity. |
Calculation of restriction of hiring cost
If a company leases a motor car after 31 March 2013 and the emissions rating of that car is greater than 130 grams per kilometre (g/km), then the allowable lease cost is restricted to 85% of the amount paid. Amounts relating to maintenance of the car are disregarded when calculating the restriction.
The allowable element of the rent for the car is restricted to:
Expenditure x (£12,000 / P) / 2P, where P is the retail price of the car when new.
Example
The company leases a car with a retail price when new of £20,000. The lease cost is £5,000 per year.
The allowable rent is restricted to:
£5,000 x ((£12,000/£20,000)/£40,000) = £4,000.
The company must restrict their claim to £4,000, and therefore disallow £1,000.
If the emission rating of the car exceeds the relevant CO2 threshold, then the allowable lease cost is restricted to 85% of the amount paid. Amounts relating to maintenance of the car are disregarded when calculating the restriction.
How do I get here?
Other adjustments> Car lease rental restriction opens Select car lease rental restriction.
