Company Cars

[veedub 0]

I have been with my present company for 7 months now and im making money for them hand over fist. I have to use the Rado on a fairly regular basis for works purposes (which I really do not like!) so im thinking about asking the boss for a company car, im 99% sure he will let me have one as all of the other managers I work with have company cars.

 

But what are the pros and cons?

 

Pro - I dont have to take the Rado to work. I worry about it ever day, living in fear of it being squashed by a forklift or hit by an artic lorry.

 

Con - I will have to pay extra tax. But how much?

 

Pro - The rado will stay clean - half a day in our yard and its covered on concrete dust. :mad:

 

Will I have to pay for the insurance on a company car?

 

Any other info and experiences would be great!!

[steve_16v 0]

I'm no expert on this but the last time I spoke to someone in the know he said it works out better to lease a car yourself and get your employer to pay you expenses to cover the cost of the lease. That way you don't get done by the company car tax.

[Toad 0]

Can't you just take an allowance from the company, and sink it into a car you buy?

[Andy665 0]

All depends on what car you would be offered and what monthly allowance you'd be given - once you know these then its pretty straightforward to work out what will be best for you. Remember that a monthly allowance is taxable

[veedub 0]

Guess I will have to speak with the boss! Lets hope he is feeling generous when he gets back from his hols!!

[Blue_Joe 0]

Bearing in mind I am currently in the process of opting out of the scheme!

 

The basic rule of thumb is that if you do more than 18,000 miles a year (business miles) then you are basically best off taking a company car. If it is less than that you are more likely to be better off opting out. But that all depends on the alloawnce given if you opt out.

 

If you have a company car the tax you pay depends on the Retail Value of the car and also its emissions. If you do a search online there are plenty of Car Tax Calculators out there. But as an example a Vauxhall Vectra Diesel type car will cost you around £3500 a year in tax.

 

However as Andy665 stated be aware that if your boss tells you he will give you X amount allowance you will get taxed at your normal rate on that.

 

You really need to look at it in quite a bit of detail to figure out which would be the best option for you as there are other factors involved with having a company car, such as who pays for the fuel, if the company gives you a fuel card, who pays your personal mileage and do you pay a contirbution. These all effect the amount of Tax you pay.

 

For example, I had a company car. Take my commission out of the equasion. I earn about £10K a year more than my missus. After Tax (me with a car and her withoutt) I would only earn £200-300 more than her a month! Thats how much it can effect your back pocket.

[A1 VR6 0]

Bear in mind though that if you take an allowance to pay for a car on a monthly basis the car is yours at some point and you have to factor in it's residual value as if you then trade in there is equity to begin with to purchase your next car. As everyone says it depends on mileage, what band of tax you pay, fuel or mileage allowance etc.

[veedub 0]

Thanks folks, food for thought there!

[bristolbaron 11]

i have a company car, with fuel card. my only expence is tax, and my tax free allowance per year is about -£1500 :(

[stingman123 0]

What you really want is what I have been enjoying for the last 6 months....a pool car. There is no expense at all. Fuel card..paid, the car is not registered to me, no tax, mot,servicing all in the contract..My boss will soon remember I've got it, but thats 6 months mileage on his motor and not on my C!!

[veedub 0]

What you really want is what I have been enjoying for the last 6 months....a pool car. There is no expense at all. Fuel card..paid, the car is not registered to me, no tax, mot,servicing all in the contract..My boss will soon remember I've got it, but thats 6 months mileage on his motor and not on my C!!

 

That would be the ticket! One of the managers I work with has pretty much the same situation, he has the 'works van' (a shagged out fiat ducato) no tax, fuel card, no expenditure at all!

Id drive a knackered van if it meant saving my rado from the perils of halfwits in forklifts!!

[VR6 Russ 0]

I have a company car and pay £47 a month on a 1.6 Focus. Its in a low emissions bracket.

 

Nice to leave the Rado tucked up away in the garage until the weekend.

[veedub 0]

I have a company car and pay £47 a month on a 1.6 Focus. Its in a low emissions bracket.

 

Nice to leave the Rado tucked up away in the garage until the weekend.

 

Do you pay for the fuel?

[Richie_FSOB 0]

Be careful about the Pool car routine, I work for a vehicle leasing company, and if you have that pool car for more than 30 days, you have to report it to the tax office legally.

They are well within their rights to demand the car tax from you later if they find out.

[Ryan S 0]

^ but surely it's already taxed?

[veedub 0]

^ but surely it's already taxed?

 

Would imagine so as the car would be owned outright by the company.

[stingman123 0]

Hmmm,

 

I was also under the assumtion that the tax was already paid for via the company, not any sigular individual, if thats not the case I'd better get rid ASAP!

[Richie_FSOB 0]

The tax is paid by any driver that has the use of a company vehicle for work and pleasure for more than 30 days.

If you drive your own car to work, use a van for the day, and drive your own car home, I believe you are ok, but if you drive a company car to work, use it for work, then drive it home, that is a taxable benifit from the company.

With regards to the company owning the van, that doesn't matter, as they are giving it to you, it is a benifit.

[A1 VR6 0]

The tax is paid by any driver that has the use of a company vehicle for work and pleasure for more than 30 days.

If you drive your own car to work, use a van for the day, and drive your own car home, I believe you are ok, but if you drive a company car to work, use it for work, then drive it home, that is a taxable benifit from the company.

With regards to the company owning the van, that doesn't matter, as they are giving it to you, it is a benifit.

I thought that if it's more than 15 days the company have to report it as a benefit in kind on the annual P11D to the taxman. A few people at my company with cars in the revenue approved scheme have incurred an additional tax liability when there vehicle has been off the road for more than 15 days and a replacement has been provided for there use.

[Ryan S 0]

The tax is paid by any driver that has the use of a company vehicle for work and pleasure for more than 30 days.

If you drive your own car to work, use a van for the day, and drive your own car home, I believe you are ok, but if you drive a company car to work, use it for work, then drive it home, that is a taxable benifit from the company.

With regards to the company owning the van, that doesn't matter, as they are giving it to you, it is a benifit.

 

So this isn't Road Tax for the vehicle - it's a tax the individual would pay for having the benefit of the company car?