Used car as company car
Discussion
Mods, please move if this is business/employment/finance.
A friend has been offered a job which comes with the gift of a used car as a company car. (For context, it's a nice used car, respectable, less than 7 years old I believe.) Obviously HMRC will say "hoho, sonny boy, that is a bona fide company car".
Could someone give me a precis of the general rules of this? I understand that he would be taxed on the new value of this car. I presume a BIK% would be determined by its "as-new" value as well. Is this correct?
A friend has been offered a job which comes with the gift of a used car as a company car. (For context, it's a nice used car, respectable, less than 7 years old I believe.) Obviously HMRC will say "hoho, sonny boy, that is a bona fide company car".
Could someone give me a precis of the general rules of this? I understand that he would be taxed on the new value of this car. I presume a BIK% would be determined by its "as-new" value as well. Is this correct?
MotorcyclesFish said:
Mods, please move if this is business/employment/finance.
A friend has been offered a job which comes with the gift of a used car as a company car. (For context, it's a nice used car, respectable, less than 7 years old I believe.) Obviously HMRC will say "hoho, sonny boy, that is a bona fide company car".
Could someone give me a precis of the general rules of this? I understand that he would be taxed on the new value of this car. I presume a BIK% would be determined by its "as-new" value as well. Is this correct?
Its not unusual in a reasonably large firm where they potentially have a pool of cars and people leaving / starting jobs regularly means they get re-allocated, would be financial suicide for a firm to return / buy new cars for staff that came and went.A friend has been offered a job which comes with the gift of a used car as a company car. (For context, it's a nice used car, respectable, less than 7 years old I believe.) Obviously HMRC will say "hoho, sonny boy, that is a bona fide company car".
Could someone give me a precis of the general rules of this? I understand that he would be taxed on the new value of this car. I presume a BIK% would be determined by its "as-new" value as well. Is this correct?
It would be unusual for a large firm to keep a car for 7 years, especially if that was because of a staff turnover concern.
The car will be taxed on it's list price when new, using the CO2 figure and the currently prevailing BiK %.
I suspect that he could buy the same model of car, maintain, insure, and tax it, and it would cost the same or very little more than his BiK charge.
He could also take the same pence/mile rate and claim tax relief on the shortfall from 45p/mile (for the first 10k pa, and 25p/mile thereafter) or negotiate a higher rate from the employer for using his own car if they agree?
The car will be taxed on it's list price when new, using the CO2 figure and the currently prevailing BiK %.
I suspect that he could buy the same model of car, maintain, insure, and tax it, and it would cost the same or very little more than his BiK charge.
He could also take the same pence/mile rate and claim tax relief on the shortfall from 45p/mile (for the first 10k pa, and 25p/mile thereafter) or negotiate a higher rate from the employer for using his own car if they agree?
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