We appreciate you reaching out here in the Community, GrahamJ19. I understand the confusion about seeing your vehicle expenses flagged as disallowable and I am here to help make sense of it.
You mentioned that your vehicle expenses are showing as disallowable income. Could you clarify where exactly you're seeing "disallowable income"? Are you viewing this in your Transactions list, on the Tax Summary page, or in a specific report? Also, could you confirm whether it says "disallowable income" or "disallowable expenses"?
Please note that vehicle expenses should fall under expense categories, not income. I recommend verifying the report by reviewing it carefully to confirm where this is appearing.
In QuickBooks Self-Employed (QBSE), the "Car/Van Expense" category works together with the Mileage Tracking feature. When you select this category, QuickBooks marks it as disallowable to make sure you aren’t claiming both the mileage rate (such as 45p per mile) and your car expenses for the same journey.
To solve this, change the category for these transactions to "Travel" or "Other Business Expenses" instead, and make sure each transaction is marked as Business, not Personal. This way, your expenses will be recorded correctly and won’t be flagged as disallowable.
It’s important to note that disallowable expenses are costs HMRC doesn’t let you deduct from your taxable profit. These include personal living expenses, client entertainment, fines, and the personal-use portion of mixed-use items such as vehicles.
For more information regarding allowable and disallowable expenses, including the official HMRC guidance, you can visit this article: Understanding allowable and disallowable expenses.
If you have further questions, just let us know. We’re here to help.
