[Closed] OT: Company car pro's and con's in laymans terms

Have a look at this website. If you know what car it would be, it'll help you work out how much it's going to cost you.

[url= http://comcar.co.uk/newcar/companycar/taxcalc/ ]http://comcar.co.uk/newcar/companycar/taxcalc/[/url]

I like having a company car for piece of mind, especially if I was doing 25-30k miles per year.

thanks.

Okay, so it looks like it could cost me £90 per month. But then I'll need to fuel it.

Am I correct in thinking that with a company car I would fill it with deisel and then claim 13p per mile?

Thanks

Be sure to check that figure. Seems low even without knowing what vehicle it is. Your tax payer rate also has to be considered. The emission levels set by the government change each tax year so what you pay will change.

you'll get your mileage (for business) paid for?

hmmmm. I think I'll just go with the car payment. Far more simple to me, which is a good thing lol

I was eligible for a company car but when I looked into it, it was only worthwhile if you were going for an expensive relatively fancy car. I only wanted something like a basic Ford Focus and would have actually been worse off if I'd used the company car scheme.

If you're doing roughly over 8k miles per years, it usually makes more sense to go with a company car as often this will include insurance, tyres, servicing etc. Bear in mind as you will be using a car for business use you need to be insured for that too, so it's not as simple as just the monthly cost, you need to take every cost into account.

Will the company let you represent them in an old, potentially unreliable banger?
If you're looking at a 4x4 then there might be a difference between having a company car vs a commercial vehicle depending on the 4x4 you opt for.

A mate of mine just specced a new Passat with moderately decent spec, would've cost him well over £550/mo out of his paycheque... 😯

I'm told 4x4s are expensive because the BiK tax is based on the new value, which is high.

I'm told 4x4s are expensive because the BiK tax is based on the new value, which is high.

BIK is a percentage of new value based on emissions. That's why 4x4s are high.

It depends a lot on your personal circumstances. I found my self in this situation last year and gave it a lot of thought before deciding to take the car. My thoughts were as follows:

1. I'm lucky enough / work hard enough to be in the 40% tax bracket so between NI and tax, 50% of the car allowance alternative was gone before I'd seen it, the remainder wasn't going to allow me to run anything more than a second hand micra.

2. We had two cars, a new Touran (lots of life left, really good fuel economy) and an 8 year old CRV (mega reliable but getting on and a fuel guzzler). So we were going to want to replace the CRV anyway in the near future.

3. I could have a really nice car, audi A5 S line including tax, insurance and all other costs covered except private fuel for the allowance as business lease costs on premium cars are ridiculously good value.

4. Yes I was going to pay quite a lot of tax so my take home pay reduced but when considering I was likely to get a new car anyway the company car route allowed me to have a much nicer car and ultimately I was better off financially and I could flatter my middle age vanity.

So its not clear cut, if I had two high mpg newish cars already I would probably have gone for the allowance but I reckon given my situation the company car was best for me. My experience won't be applicable to you but may ask some questions that help you decide.

I get 20p per mile for company mileage for my diesel.

I'm sat speccing up a new car on arval to opt back into the car scheme at work

It's all about picking a car that's heavily discounted by the manufacturer, low emissions, low servicing costs, low P11D value.

If you can be bothered to search (a lot) you can find some real surprises.

25-30k though... That'd be a company car.

For that mileage I would be going the company car route but be careful with 4x4s as they can sometimes end up in the commercial vehicle bracket which is flat rate taxed as opposed to based on CO2.

Also make sure the company are going for a maintained lease so you just drop it in to garages for services/new tyres/new windscreens when the needs arise.

My golf costs me about £60 a month and I get 13 ppm back on the fuel. I actually make money on the fuel it's so efficient and there is no way I could fund a brand new car every 3 years on £60 a month.

Pros - It's a free car!

Cons - Oh, actually it costs you money.

Only you know the figures that are on the table. Comcar.com is a good resource to work out where the break even points are.

I had a Co. car for years; but I opted out 5 years ago. Most of the time I'mm winning, despite a few bumps in the road (when the gearbox went in my car, it was my problem)

And I do 40,000 miles a year.

Another issue that I have had twice is the handcuff effect as in lose/move job you lose your car . Having had this mild inconvenience twice I would opt not to have a company car .

Yeah check the T&C on the car payment could well mean you need to get something under a certain age with a safety rating etc.

I was eligible for a company car but when I looked into it, it was only worthwhile if you were going for an expensive relatively fancy car. I only wanted something like a basic Ford Focus and would have actually been worse off if I'd used the company car scheme.

This and the milage but if you take the allowance check the conditions of it. Mine means I have to have a sub <5yo car whihc means I actaully cant get a lot of car for my money ast that age, without sonme careful planning, appropriate pcp or lease.

As above car payments often have limitations, my last place was under 7 years old, now it's under 7 years and sub 120g/km co2. Fine for me as I'm on a pcp and it's cheaper but it's not the easiest of calls. I was mainly driven by my wife needing to use the car for business occasionally. I'd not worry too much about insurance unless you're doing something extreme, business cover made the square root of sod all difference for me as an environmental consultant.

I've had a company car for the last 6/7 years, I currently have a 2.0 Passat Estate.

I do around 25k miles per year (15k commute/5k business/5k personal)
I'm taxed approx. £1800 for the car, and pay £350ish lease for it.

To me it is worth it - we like the peace of mind, and use my car (rather than my wife's) for absolutely everything at weekends, etc. as the lease company pay for all servicing/tyres/etc.

The trick is to work out which car on the list gives you best value for money and go for that - I had a BMW 1-series last time, the monthly lease was less than a Skoda Octavia (due to higher resale value I guess?) and the tax was low due to emissions.

I also like the idea that if they make me redundant - they get the car back, and I'm not paying a lease/finance if I'm out of work (and wouldn't really need the car anyway)

If you're expecting to do 25-30k a year, I'd say a company car is a very good idea.

I'd always think that for the sort of business mileage you're talking about doing you'd be nuts to fund your own car.

Yes you'll pay company car tax - but won't have to pay for maintenance / insurance / finance on the car itself.

[i]Only you know the figures that are on the table.[/i]

This.

I've had loads of company cars and loads of private cars. The best answer is totally dependent on timing and need (plus your ability to be able to, if you've gone with the private option, always have a car available when you need it).

Just do the research and create your own spreadsheet - asking others will only get what is either best for them or what they've chosen to do based upon personal want/need.

For me, I took the car payment instead of a company car and bought a 3 year old Passat estate. I don't do many miles though, so it was just a case of getting the cheapest vehicle to fulfil the criteria which would also meet my needs.

My numbers won't correlate with yours though, so you need to work out the comparative costs of each option.

Cheers, Rich

A mate of mine just specced a new Passat with moderately decent spec, would've cost him well over £550/mo out of his paycheque...

Even higher rate BIK on the passats is about £200/month, you sure he's doing it right?

personally if I were looking at a company car for site work I'd be looking at the Mitsubishi Outlander. You can either go fer a commercial one, which has a bench seat, privacy rear windows (which don't roll down) and is classed as a van, so you get taxed on a straight £2k per year.

Alternatively, if you have the option, you could look at the Outlander PHEV hybrid, seems like a few benefits from that, £5k toward purchase, great MPG, £0 VED and the company can claim 100% of the value against taxable profits in the first year.

we have a couple of commercial outlanders, but I think they next will be the PHEV.

EDIT: sorry personal tax on this works out at 5% of the value for hybrids, so about £20-30 per month.

Electric & hybrids are becoming a brilliant option for company cars. I have just ordered a Mercedes C-Class estate - 350E. It's a petrol/plug in hybrid and falls within the 5% benefit in kind tax - based on 49g/km co2 & 136 mpg (we'll see about that last statement though as) so despite it being a £40k car, it will cost me just £65 a month in tax.

I'm not the only one thinking like this because I have to wait until April for delivery.

massive thanks for all the info above people.

Today I decided to take the other job. I'll be doing around 8k miles per year and the car payment is pretty decent.

Yes, the banger is a bit of a risk but I'm hoping it will do until I have enough cash put away to get something else.

In the end tis job pays better and has better prospects. I'm not earning mega money and 3 kids aint cheap! But it's far better than what I had and in the end the current company couldn't get close on salary. However we have left on very good terms and I have a way back if I need it.

So here's to new beginnings - in an old banger lol

Cheers