Anyone still running their exotic as a company car?
Discussion
bertie said:
I am at the moment, the change doesn't happen until 2010/11.
What other method are you using?
I'm not using any method at the moment, but I was looking at putting a car through the company. I can't see this method being beneficial to anyone now. For examples, someone running a used Murci could be looking at a benefit in kind of £70 to £80k, which could push them right into the 50% tax bracket. What other method are you using?
The other purchase method I looked at (mentioned here on this forum) was to buy the vehicle privately using a director's loan. The BIK is a lot lower and you can sell the car at a later date to pay back the loan, making up the depreciation loss with your normal dividend drawings or personal savings.
I'm fairly sure you cant just take out a massive wadge of money and call it a Directors Loan. The max you can take is £5k tax free, thereafter its taxable. And I seem to recall any Directors Loan outstanding at end of financial year (over £5k) has something quite penal such as an instant 25% corptax applied.
kryten22uk said:
I'm fairly sure you cant just take out a massive wadge of money and call it a Directors Loan. The max you can take is £5k tax free, thereafter its taxable. And I seem to recall any Directors Loan outstanding at end of financial year (over £5k) has something quite penal such as an instant 25% corptax applied.
Spot on, I am sure there will be various schemes come out in the next year.Could you not buy the car privetly via hp (low rate) then increase your salary to cover the monthly payment, that way you would only have the increase in tax and NI on the salary increase.
No company car tax, and could charge company for fuel.
Or use a full payout lease, offset 85% of monthly rentals and half VAT. You would still get tax at P11D price, but saving to company would be fairly high still.
No company car tax, and could charge company for fuel.
Or use a full payout lease, offset 85% of monthly rentals and half VAT. You would still get tax at P11D price, but saving to company would be fairly high still.
kryten22uk said:
I'm fairly sure you cant just take out a massive wadge of money and call it a Directors Loan. The max you can take is £5k tax free, thereafter its taxable. And I seem to recall any Directors Loan outstanding at end of financial year (over £5k) has something quite penal such as an instant 25% corptax applied.
Yes, interest free loans over £5k are treated as a benefit. The benefit is the interest you would save if you had taken a regular loan from a bank. The loan does need to be repaid, but can be taken again 4 weeks later I think. You do need to be able to juggle some money around.http://www.hmrc.gov.uk/ct/returns/director-loan.ht...
wargriff said:
Could you not buy the car privetly via hp (low rate) then increase your salary to cover the monthly payment, that way you would only have the increase in tax and NI on the salary increase.
No company car tax, and could charge company for fuel.
Or use a full payout lease, offset 85% of monthly rentals and half VAT. You would still get tax at P11D price, but saving to company would be fairly high still.
I haven't looked at these options yet. I need to do some number crunching, but the Director's loan looks pretty hard to beat at the moment.No company car tax, and could charge company for fuel.
Or use a full payout lease, offset 85% of monthly rentals and half VAT. You would still get tax at P11D price, but saving to company would be fairly high still.
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