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Cost of providing a company car?



Normal Rob

Well-known member
Jul 8, 2003
5,636
Somerset
Does anybody know how much it would cost a company to provide me with a company car. I do a lot of travelling on trains and in hire cars and I'm thinking of putting forward a proposal to be given a company car. The company that i work for already provides about 30-40 others with cars (people in different roles though)

I'm not after anything grand - just a Focus or similar....

Any rough figures would be helpful...

Thanks.
 

strings

Moving further North...
Feb 19, 2006
9,965
Barnsley
It is difficult to say. From my time as a trustee of a charity, I seem to remember that if one person is given a company car everyone else in a similar role is entitled to one too - or at least entitled to have an opportunity to prove their need of one.

There are all kinds of funny tax regulations, I seem to remember too - some companies register company cars as 'pool cars' - to avoid paying extra tax. Make sure your company don't do this as it is amost certainly illegal if you are the sole user of said car.
 

Normal Rob

Well-known member
Jul 8, 2003
5,636
Somerset
It is difficult to say. From my time as a trustee of a charity, I seem to remember that if one person is given a company car everyone else in a similar role is entitled to one too - or at least entitled to have an opportunity to prove their need of one.

There are all kinds of funny tax regulations, I seem to remember too - some companies register company cars as 'pool cars' - to avoid paying extra tax. Make sure your company don't do this as it is amost certainly illegal if you are the sole user of said car.


I'm 120 miles away from my nearest fellow employee...
 

Normal Rob

Well-known member
Jul 8, 2003
5,636
Somerset
Unlike the old days it would be taxable. Are you sure you want to take a tax hit?

really don't know Bozza - I guess that depends on the size of the hit placed up against the money i'd save from ditching my own car and the costs that it incurs in road tax, MOT and servicing, insurance etc.

I need to look at all these things but knowing the cost of providing a car is a big missing piece of info when thinking about making the proposal.
 


Bozza

You can change this
Helpful Moderator
Jul 4, 2003
55,529
Back in Sussex
Type lease car into Google and you'll get to a lot of sites offering 3+36 deals for company cars.

A Focus would probably be £200-£250 (+VAT) per month.
 

Horton's halftime iceberg

Blooming Marvellous
Jan 9, 2005
16,484
Brighton
My accountant always says it costs much more than the company gets out in savings, and you are better to cliam back mileage. Are you in a position to just claim cost/car rental back if your job relys on it.
 

Bad Ash

Unregistered User
Jul 18, 2003
1,900
Housewares
They would pay the lease price of the car, note that they can't clam all of the VAT back (estimate £300 per month). Then there is the insurance (probably ~£1k per year) and other repair costs (£500?). On top of this there's the national insurance - 12.8% of the Benefit In Kind (BIK) value of the car (say 18% of the value of the var - this depends on the CO2 emmissions and the fuel type (diesel is +3%)).

If you get a fuel card as well they will pay for the fuel costs plus NI (12.8%) on £16,900 x the BIK % (18% in earlier example).

Cost to the empliyee is the tax (20%/40%) on:
Car: List Price x BIK% (e.g. £18,000 x 18%)
Fuel: £16,900 x BIK% (e.g. £16,900 x 18%)
 


Garage_Doors

Originally the Swankers
Jun 28, 2008
11,789
Brighton
as guide it will cost you £100-200 per month in tax for a company car, your better off getting an allowance to buy your own.
 

Shropshire Seagull

Well-known member
Nov 5, 2004
8,463
Telford
Key to the calc is how many business miles you estimate you will do.

If you use your own car HMRC private mileage guideline is 40p per mile for the first 10k the 25p per mile after - this is intended to cover all running costs, fule, ins, road fund, servicing + not sure about wear & tear or depreciation.

Compare this to a lease car where you will still need to pay for you fuel - some offer service contracts but wear & tear [tyres etc.] won't be covered.

My accountant says its simpler for me to use my own car and use private mileage claim then go through lease / purchase.

Pros & cons, but as mentioned above, I'd first look at how your PAYE code gets hit. When I had a CoCar 10 years ago I ended up with a k (negative) tax code - means you owe PAYE before you've even earnt your first £1 - nasty!
 

Tim Over Whelmed

Well-known member
NSC Licker Extraordinaire
Jul 24, 2007
10,160
Arundel
The best way for you is for your company to hire you a car when you need it ONLy or have the use of a pool car. I have just started my own company and whilst I could afford to have not purchased a company car, I purchased my own and then bill my company the milegae, worth looking at!
 


beorhthelm

A. Virgo, Football Genius
Jul 21, 2003
35,237
given you say they already provide company cars for others, i'd have thought its cheaper for them to provide hire/rail as they do, otherwise they'd have given the car already.
 

Billy the Fish

Technocrat
Oct 18, 2005
17,471
Haywards Heath
If your company already have people with company cars then they will know how much it costs them to provide one. Lots of irrelevant advise on this thread as well.

As for the tax cost to you it depends on your tax bracket. I'm 22% and I drive an Astra 1.9 SRI diesel which costs me £73 a month. If you were the 40% bracket it would cost you £133 a month. The calculation Bad Ash has given is how they work out this number.
 

Normal Rob

Well-known member
Jul 8, 2003
5,636
Somerset
given you say they already provide company cars for others, i'd have thought its cheaper for them to provide hire/rail as they do, otherwise they'd have given the car already.

not so - for many complicated reasons but my role has only recently been TUPE'd into the company and i'm the only one based in the south west so it's a new situation to both them and I.

Anyhow cheers for the words of wisdom I think i'm just going to put my side of the numbers together and pass it across. If there's legs in it them i guess i can look at the financial impact on myself. If there's not then there would be no need to worry about that...
 

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