Company car tax in business with two employees!
Discussion
So I am new to all of this. We have a meeting with the accountant next week but I want to be prepared as we are starting to look for cars.
I am joining a LTD company that has one employee, the owner,the director himself. He (soon to be we) conduct surveying and consultancy for insurance underwriters. Currently not VAT registered but be will be going that way in the new year. The company invoice for every submitted survey and 45p per mile for distance travelled from office to site. Work is international.
For the first three months I will be getting paid my current salary, phone, laptop and a lot of training on the job and courses to get me qualified. The investment the boss is putting in is huge as I wont be really earning for a good six months. I will be supplied a company car purchased through the business by finance, this will be fully maintained.
For a first car we were looking at spending circa 13k for a VW approved Passat Bluemotion. Work related fuel will be paid by the company. For personal fuel I was just hoping to chuck in what I need.
I have read about BIK but do not fully understand. I have to pay tax through PAYE as I use the vehicle outside of work?
Even though the car is second hand and 10k less than new, I still pay BIK on list? and because I don't want a 1.6 eco poop I also pay more for the 2.0?
What are the other options? A car allowance and the money gets liberated through income tax? I really didn't want to do this as during the next 18 months the girlfriend and I will be purchasing our first houses and do not want any unnecessary debt against my name, and the boss agrees with this.
I am joining a LTD company that has one employee, the owner,the director himself. He (soon to be we) conduct surveying and consultancy for insurance underwriters. Currently not VAT registered but be will be going that way in the new year. The company invoice for every submitted survey and 45p per mile for distance travelled from office to site. Work is international.
For the first three months I will be getting paid my current salary, phone, laptop and a lot of training on the job and courses to get me qualified. The investment the boss is putting in is huge as I wont be really earning for a good six months. I will be supplied a company car purchased through the business by finance, this will be fully maintained.
For a first car we were looking at spending circa 13k for a VW approved Passat Bluemotion. Work related fuel will be paid by the company. For personal fuel I was just hoping to chuck in what I need.
I have read about BIK but do not fully understand. I have to pay tax through PAYE as I use the vehicle outside of work?
Even though the car is second hand and 10k less than new, I still pay BIK on list? and because I don't want a 1.6 eco poop I also pay more for the 2.0?
What are the other options? A car allowance and the money gets liberated through income tax? I really didn't want to do this as during the next 18 months the girlfriend and I will be purchasing our first houses and do not want any unnecessary debt against my name, and the boss agrees with this.
I am sure that the last option is what the boss does, offsetting against mileage.
Will see what the accountant says but looks like it's a 1.6 drivE v50 for me!
I assume if I purchase the car in my name and the allowance is paid through PAYE, I Jane to pay for all maintenance costs? We can't pay through the business?
Will see what the accountant says but looks like it's a 1.6 drivE v50 for me!
I assume if I purchase the car in my name and the allowance is paid through PAYE, I Jane to pay for all maintenance costs? We can't pay through the business?
Just to make the picture clearer the surveying done is for risk, so no equipment needed. The chap I am going to be working with is a friend. He has worked seven years to build the business to where it is and is wanting to expand. The outlay for training will be substantial and my wage is being paid for at least three month without earning a penny. I am very grateful for the opportunity and in the future will be part of moving the company forward, therefore I am wanting the cheapest option for the company and myself.
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