Ken Craig from Peterborough accountant Rawlinsons said: “From April 2009 motorcycles are no longer treated for tax purposes like cars but as plant and equipment. This has a significant affect on the amount of tax relief you can claim when you buy a motorcycle for use in your business.
“Company cars are now limited to a 20% or 10% annual tax write down unless they have a carbon footprint below 110g/km, in which case you may qualify for a 100% allowance. The same criteria no longer apply to motorcycles; whatever their CO2 emission, 100% of the cost is potentially available as a tax write off in the year of purchase.”
For bikers in business this is good news, especially those who are are self employed and higher rate tax payers.
“The change in tax status does seem to open up tax planning opportunities to business owners who can justify the use of a motorcycle in their business,” said Mr Craig. “If you could write off the cost of a £10,000 machine and you were a 40% tax payer, you would possibly carve £4,000 off your tax bill.”
As with all tax planning the devil is in the detail. Rawlinsons has offered to give interested companies its opinion if they would like to take advantage of the opportunity this recent change in tax law allows.