Best lease car deals available?

[Blown2CV]

gizlaroc said:

Blown2CV said:

You can't pay for a business user deal from a private individual's bank account. Also you are linked to the car as it's coming out of your account. Maybe I am completely missing something here, but none of this makes any sense.

It's not for you then is it.

well i don't own a company, have the company accountant on a leash, have my own personal tax avoidance consultant, have a special arrangement with my mate who owns a leasing co, so no... it was never for me in the first place. Me along with 99.9% of the rest of the country. So, back to normally accessible lease deals then.

[theboss]

gizlaroc said:

Have to be subscribed to read it, here it is...

The article appears to be misleading. HMRC were defeated but changed the relevant legislation two months later:

Awkward URL -

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/264440/20._Income_tax_-_company_cars__repeal_of_section_114_3__Income_Tax__Earnings_and_Pensions__Act_2003.pdf

HMRC said:

BACKGROUND NOTE
3. Section 114(3) ITEPA 2003 provides that
Chapter 6 of Part 3 of ITEPA 2003
(Taxable Benefits: Cars, Vans and related benefits) does not apply if the cash equivalent of
the benefit of a company car or van made available for private use constitutes earnings from
the employment by virtue of any other provision. This could allow an individual to pay less
tax on their car or van benefit than the Government originally intended and have a negative
impact on Exchequer revenue.
4. From 6 April 2014, section 114(3) ITEPA 2003 will be repealed for the tax year
2014-15 and subsequent tax years. This supports the Government’s policy of the full amount
of car or van benefit being subject to tax and protects Exchequer revenue. Protection from
double taxation is already provided by other provisions in the Act.

The new legislation appears to support a 'reduction' of BIK liability based on an employee contribution towards 'running costs'. It will be interesting to see how this is applied.

I'm no HMRC 'do gooder' - if I were convinced that I could sign a business lease and legitimately avoid any BIK, I'd have more Golf R's on the drive than you can shake a stick at.

Blown2CV said:

company accountant on a leash

I think in many of these cases the accountants appear as ignorant or misguided as their clients.

Edited by theboss on Tuesday 30th September 11:00

[ArsE92]

Blown2CV said:

N88 said:

Blown2CV said:

N88 said:

AGK said:

VW have always had good prices for leasing these but you have to prove you have a business.

Once you add BIK it isn't that attractive.

Except you wouldn't provide it to the director as a company car, it would just be a £165 payment to their loan account.

Also wouldn't apply to the self employed.

Edited by N88 on Monday 29th September 12:52

it comes up i'd say every month, some tard thinks they can play the tax/business lease system. Presumably you think you're literally the first person to think of that, yes?

I've not read all the responses so not sure if it's already been covered. We have several clients who stick their lease payments straight to their loan account. You're not getting the benefit of claiming back the VAT but it still tends to work out better than a personal lease deal. There was a case that went to court with HMRC a few months back and it was deemed a legitimate way of doing things, so we're happy to treat them this way based on that. If anyone want's the link I'll dig it out.

ps. Try being a little less aggressive with your posts in future

Please do post the link. I'd love to know why if the car is owned by the company but paid for by the user that there aren't wider tax implications than just VAT. Presumably the only way the company would agree to this is if the user in question owns the company as there's no way they'd take on the financial responsibility for the contract otherwise. The reason for my response is because, as I said, it comes up very regularly that some bright spark thinks they can play the system. Maybe you are the only one in hundreds, in which case well done, however as far as I am concerned it's unlikely and it's not really what the thread is about.

Hey N88 - at least the insult has been downgraded from retard to bright-spark

[gizlaroc]

xRIEx said:

Are you talking about 'your' company leasing it to you as though you were a customer, rather than you as an employee?

Thanks for quoting that when I had deleted it. Appreciated!


Yeah, but as the article says above that ended in April.

Edited by gizlaroc on Tuesday 30th September 12:01

[gizlaroc]

theboss said:

gizlaroc said:

Have to be subscribed to read it, here it is...

The article appears to be misleading. HMRC were defeated but changed the relevant legislation two months later:

That is what the article says.

article said:

New rule - first trap for contributions
The amount on which a director or employee is taxed on their company car is reduced where the company requires them to make a contribution towards its running costs. The bad news is that rental payments made under a lease arrangement don’t qualify for the tax reduction.

Tip. Instead of charging rent your company can ask its car drivers to pay the same amount as a contribution towards running costs. Put this in writing. The effect will be to reduce the amount on which they are taxed. For example, if the company car BiK for a director is £5,000 per year and the director pays £1,800 towards costs, the taxable amount is reduced to £3,200.

If you contract hire an M135i for example, it is £210 a month plus vat, so £250 a month.
If you then contribute £250 a month towards 'running costs' you will not pay any BIK tax, as the BIK tax is slightly less than the £250 you have contributed.

[xRIEx]

gizlaroc said:

xRIEx said:

Are you talking about 'your' company leasing it to you as though you were a customer, rather than you as an employee?

Thanks for quoting that when I had deleted it. Appreciated!


Yeah, but as the article says above that ended in April.

Obviously you hadn't deleted it when I quoted it, otherwise I couldn't possibly have quoted it, don't get narky at me.

[russ_a]

What if you don't claim the lease or vat back through the business but simply benefit from the reduced list price offered by the brokers for non-retail customers?

[illmonkey]

How are people getting on with new businesses? I only started one a few weeks ago, and don't even have a bank account yet. Will I get accepted? It's all above board, I have a contract role with a signed contract.

[Snollygoster]

Blown2CV said:

Snollygoster said:

Blown2CV said:

I didn't say personal loan, I was actually thinking you were on about a director's loan. In any case if you're paying out your personal account, what makes that anything to do with the company, director or not? Also you're directly linked to the car, how is there no paper trail as you're saying?

That's the point. I agree there's no paper trail so the only documentation tying it to a "business lease" is the actual lease agreement with the manufacturer.

You can't pay for a business user deal from a private individual's bank account. Also you are linked to the car as it's coming out of your account. Maybe I am completely missing something here, but none of this makes any sense.

Why can't you pay for it out of a private individuals bank account? There use the 6 digit sort codes and 8 digit account numbers like us. There's nothing special about them.

Thus, using that there's nothing on the company books about the vehicle.

[theboss]

gizlaroc said:

theboss said:

gizlaroc said:

Have to be subscribed to read it, here it is...

The article appears to be misleading. HMRC were defeated but changed the relevant legislation two months later:

That is what the article says.

article said:

New rule - first trap for contributions
The amount on which a director or employee is taxed on their company car is reduced where the company requires them to make a contribution towards its running costs. The bad news is that rental payments made under a lease arrangement don’t qualify for the tax reduction.

Tip. Instead of charging rent your company can ask its car drivers to pay the same amount as a contribution towards running costs. Put this in writing. The effect will be to reduce the amount on which they are taxed. For example, if the company car BiK for a director is £5,000 per year and the director pays £1,800 towards costs, the taxable amount is reduced to £3,200.

If you contract hire an M135i for example, it is £210 a month plus vat, so £250 a month.
If you then contribute £250 a month towards 'running costs' you will not pay any BIK tax, as the BIK tax is slightly less than the £250 you have contributed.

The employee contribution merely reduces the BIK taxable amount as you have quoted, not the BIK tax. For a manual M135i this will be 28% of RRP - what's that on the back of a fag packet - £9k? £250 a month you say? I make it £750

[theboss]

Snollygoster said:

Why can't you pay for it out of a private individuals bank account? There use the 6 digit sort codes and 8 digit account numbers like us. There's nothing special about them.

Thus, using that there's nothing on the company books about the vehicle.

FFS are you reading or ignoring the cases I've referred to? Contract in company name = BIK liability arising.

I'm done with it. Hopefully what I've posted will help somebody think about this before "pulling the trigger".. To anyone else going down this route and relying on blind good fortune that HMRC don't notice... Good luck.

[rfoster]

Snollygoster said:

Why can't you pay for it out of a private individuals bank account? There use the 6 digit sort codes and 8 digit account numbers like us. There's nothing special about them.

Thus, using that there's nothing on the company books about the vehicle.

The finance companies will not allow it. The lessee of the vehicle must be the one paying for the lease. What would happen, for example, if you had a lease agreement through your company, but the payments comes from someone's personal account; and the agreement falls into arrears? The company will be the one getting the black mark from the finance company, not the individual who was paying from their account.

[Blown2CV]

Snollygoster said:

Blown2CV said:

Snollygoster said:

Blown2CV said:

I didn't say personal loan, I was actually thinking you were on about a director's loan. In any case if you're paying out your personal account, what makes that anything to do with the company, director or not? Also you're directly linked to the car, how is there no paper trail as you're saying?

That's the point. I agree there's no paper trail so the only documentation tying it to a "business lease" is the actual lease agreement with the manufacturer.

You can't pay for a business user deal from a private individual's bank account. Also you are linked to the car as it's coming out of your account. Maybe I am completely missing something here, but none of this makes any sense.

Why can't you pay for it out of a private individuals bank account? There use the 6 digit sort codes and 8 digit account numbers like us. There's nothing special about them.

Thus, using that there's nothing on the company books about the vehicle.

they're not idiots, they can tell whose name the account is in. Anyway, my head hurts from banging it against this brick wall so let's put this to bed. Go try it, let us know how you get on.

[crosseyedlion]

How about going back to finding great lease deals rather than arguing.

Lifes too short...

[Blown2CV]

crosseyedlion said:

How about going back to finding great lease deals rather than arguing.

Lifes too short...

big time.

[gizlaroc]

theboss said:

The employee contribution merely reduces the BIK taxable amount as you have quoted, not the BIK tax. For a manual M135i this will be 28% of RRP - what's that on the back of a fag packet - £9k? £250 a month you say? I make it £750

No, read it again.

If the BIK is £5000 a year and the employee pays £1800 towards upkeep he is only taxed £3200.

This is not dedeucted from the taxable value, but the amount of BIK tax he is paying.

[Derwins Revenge]

Blown2CV said:

crosseyedlion said:

How about going back to finding great lease deals rather than arguing.

Lifes too short...

big time.

Good idea, almost sorry I pushed for details in the first place, but some decent info came from it.

Just pressed go on a Golf R anyway (always intended to pay Bik, was just interested in the concept). The BiK is my personal cost of having a nice car at the end of the day (my view, no need to spend two more pages discussing it). Otherwise I'd be ordering another stty 320D...

[gizlaroc]

xRIEx said:

gizlaroc said:

xRIEx said:

Are you talking about 'your' company leasing it to you as though you were a customer, rather than you as an employee?

Thanks for quoting that when I had deleted it. Appreciated!


Yeah, but as the article says above that ended in April.

Obviously you hadn't deleted it when I quoted it, otherwise I couldn't possibly have quoted it, don't get narky at me.

I should have added a wink!
I wasn't getting narky as I replied.


It was some 15 minutes after I deleted it, I presumed you had started to answer and got caught up with stuff. I wasn't getting narky at all.

[Snollygoster]

Blown2CV said:

Snollygoster said:

Blown2CV said:

Snollygoster said:

Blown2CV said:

I didn't say personal loan, I was actually thinking you were on about a director's loan. In any case if you're paying out your personal account, what makes that anything to do with the company, director or not? Also you're directly linked to the car, how is there no paper trail as you're saying?

That's the point. I agree there's no paper trail so the only documentation tying it to a "business lease" is the actual lease agreement with the manufacturer.

You can't pay for a business user deal from a private individual's bank account. Also you are linked to the car as it's coming out of your account. Maybe I am completely missing something here, but none of this makes any sense.

Why can't you pay for it out of a private individuals bank account? There use the 6 digit sort codes and 8 digit account numbers like us. There's nothing special about them.

Thus, using that there's nothing on the company books about the vehicle.

they're not idiots, they can tell whose name the account is in. Anyway, my head hurts from banging it against this brick wall so let's put this to bed. Go try it, let us know how you get on.

Think what you like. It goes through.

I've been sat in meetings looking at spreadsheets of analysing business contract hire with many of the supposed business clients being in the name of "John Smith T/a John Smith" with the bank account name being "Mr and Mrs Smith".

Even genuine business have had personal bank details. If that bank account is clean if will sail through most automated checks despite an account name being something completely different to the business name.

Edited by Snollygoster on Tuesday 30th September 14:21

[gizlaroc]

Blown2CV said:

gizlaroc said:

Blown2CV said:

You can't pay for a business user deal from a private individual's bank account. Also you are linked to the car as it's coming out of your account. Maybe I am completely missing something here, but none of this makes any sense.

It's not for you then is it.

well i don't own a company, have the company accountant on a leash, have my own personal tax avoidance consultant, have a special arrangement with my mate who owns a leasing co, so no... it was never for me in the first place. Me along with 99.9% of the rest of the country. So, back to normally accessible lease deals then.

I was just replying to your comment than none of this makes sense, hence why I said, it's not for you then.


Read the link I posted up mate, it is quite interesting.