Discussion
Hi all,
Looking at acquiring a small fleet to be used for customer calls by my sales team: vehicles will be signwritten and private use will be forbidden, so they should be treated as pool cars rather then perk/company cars, but HMRC rules also require that a pool car should not be taken home overnight by the same employee more than 60% of the time: this makes sense except where, as my team are, the employee is home-based...so there's nowhere else for the car to be kept.
Does anyone have experience of addressing this with HMRC?
Looking at acquiring a small fleet to be used for customer calls by my sales team: vehicles will be signwritten and private use will be forbidden, so they should be treated as pool cars rather then perk/company cars, but HMRC rules also require that a pool car should not be taken home overnight by the same employee more than 60% of the time: this makes sense except where, as my team are, the employee is home-based...so there's nowhere else for the car to be kept.
Does anyone have experience of addressing this with HMRC?
How is that not a company car?
My definition of a pool car is that any employee can use it at any time. If it's given to a home based person, then no-one else can use it unless they go to that persons house.
Getting to and from your home to your place of work is personal use and is never classed as company use. I doubt the fact that they are home based would make any difference. Do they not need to come into the office at some point?
When I finish for the day and I drive home in a company car, that is personal use as it is not in connection with my work/business.
I doubt very much that HMRC would let you get away with that definition of pool car. Too much tax to be lost for them.
Only my own opinion but I think you know that you're trying to bend the rules too far. That 60% rule applies and you know it.
Of course you could just ignore the rules and hope you don't get caught. ;-)
PS maybe you could get around it with a van classified vehicle (IE no back windows) I think they attract a much lower flat rate of tax.
My definition of a pool car is that any employee can use it at any time. If it's given to a home based person, then no-one else can use it unless they go to that persons house.
Getting to and from your home to your place of work is personal use and is never classed as company use. I doubt the fact that they are home based would make any difference. Do they not need to come into the office at some point?
When I finish for the day and I drive home in a company car, that is personal use as it is not in connection with my work/business.
I doubt very much that HMRC would let you get away with that definition of pool car. Too much tax to be lost for them.
Only my own opinion but I think you know that you're trying to bend the rules too far. That 60% rule applies and you know it.
Of course you could just ignore the rules and hope you don't get caught. ;-)
PS maybe you could get around it with a van classified vehicle (IE no back windows) I think they attract a much lower flat rate of tax.
As above really. You should also be keeping a mileage log in each car, and every time an employee uses the car, they log the date, start mileage, end mileage, destination and reason for the journey.
That then also ensures the vehicles are not used for personal transportation.
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
That then also ensures the vehicles are not used for personal transportation.
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
Dr Interceptor said:
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
From a Employee's point of view taking a pool car home once in a blue moon because the office would be closed when you got back or because the company want you to have an early start and the journey is shorter and the start time more reasonable if you leave from home, is "normal" but using it as though it is their own car isn't. I suppose you could get round the company car thing if the home worker swapped pool cars every so often but even then you are likely to be on shaky ground.Engineer1 said:
Dr Interceptor said:
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
From a Employee's point of view taking a pool car home once in a blue moon because the office would be closed when you got back or because the company want you to have an early start and the journey is shorter and the start time more reasonable if you leave from home, is "normal" but using it as though it is their own car isn't. I suppose you could get round the company car thing if the home worker swapped pool cars every so often but even then you are likely to be on shaky ground.Dr Interceptor said:
As above really. You should also be keeping a mileage log in each car, and every time an employee uses the car, they log the date, start mileage, end mileage, destination and reason for the journey.
That then also ensures the vehicles are not used for personal transportation.
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
Apologies for thread hi-jack, but I've been contemplating getting a car for the business (ltd. co.) to cut down on the miles I'm putting on mine. The snag is that I am home-based (and effectively the only employee) as my office at home is the company's HQ. I guess, even with a log of miles etc., there's no way I could avoid P11D ? That then also ensures the vehicles are not used for personal transportation.
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
marshalla said:
Dr Interceptor said:
As above really. You should also be keeping a mileage log in each car, and every time an employee uses the car, they log the date, start mileage, end mileage, destination and reason for the journey.
That then also ensures the vehicles are not used for personal transportation.
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
Apologies for thread hi-jack, but I've been contemplating getting a car for the business (ltd. co.) to cut down on the miles I'm putting on mine. The snag is that I am home-based (and effectively the only employee) as my office at home is the company's HQ. I guess, even with a log of miles etc., there's no way I could avoid P11D ? That then also ensures the vehicles are not used for personal transportation.
If they are pool cars, your staff should not be taking the cars home, they should commute into the office where they then pick up the car. If they take the car home, it's a company car, and they'll need to complete a P11D for benefits and expenses.
Providing the car was only used for work, with a mileage log, there's no benefit gained by you, so no need for a P11D. Best check with your accountant though.
EDIT: Sit down and do the maths, but depending on how many miles you do, it can work out more cost effective to personal lease a car. You pay for the car, insurance and fuel out of your own pocket. Then charge the company back 45p per mile for your business mileage (up to I think 10k, then 20-something pence thereafter). If you do enough miles, the payments the company makes to you should more than cover the cost of the vehicle. Then you can use it for personal use too, as it's yours.
Edited by Dr Interceptor on Thursday 6th February 10:05
Edited by Dr Interceptor on Thursday 6th February 10:06
Cheers all. I don't want my people to be paying a full BIK tax charge for a sign-written vehicle that is of no benefit to them personally; further digging suggests that the answer is not pool cars, but allocated company cars plus (a)a written, enforceable company policy forbidding personal use of the vehicles, and (b)a mileage log for each vehicle demonstrating that no personal use has taken place.
From what I can see on HMRC's site, travelling from home to customer sites and back is not personal use for a contractually home-based worker. If a once-a-month trip to the office is all it would take to foul-up the arrangement then I'll pay for them to come in on the train or use their own cars - I can't believe it would be an issue, however, since their homes are their places of work, not the office, so travel to the office is not 'commuting' - it's also a 400 mile round trip for two of them...
From what I can see on HMRC's site, travelling from home to customer sites and back is not personal use for a contractually home-based worker. If a once-a-month trip to the office is all it would take to foul-up the arrangement then I'll pay for them to come in on the train or use their own cars - I can't believe it would be an issue, however, since their homes are their places of work, not the office, so travel to the office is not 'commuting' - it's also a 400 mile round trip for two of them...
Exclusive use and kept at home is pretty dangerous territory. Just because it is sign written doesn't mean a lot either.
Not saying it can't be done but the HMRC are likely to be very skeptical. Our pool cars are sign written, live at the office and when someone needs one they will be allocated what's available, not the same one and we keep mileage logs. Even so we've had it questioned by HMRC more than once.
Not saying it can't be done but the HMRC are likely to be very skeptical. Our pool cars are sign written, live at the office and when someone needs one they will be allocated what's available, not the same one and we keep mileage logs. Even so we've had it questioned by HMRC more than once.
given a fully marked and part of the rear seats removed for kit cages, passenger seat replaced with mdt/ toughbook mount etc Ambulance RRV has been considered a Company car if allocated to a home based member of staff, a sign written unmodified car will be definitely seen as such if allowed to be taken home etc.
Meltham Terrier said:
Why not give a car allowance and pay mileage and save the hassle.
Because then I won't have a matching set of signwritten cars visiting my customers, conferences, public launches etc.It's no hassle for me: I'll write the policy, create the template mileage log, issue the cars and instructions and then enforce the policy with disciplinary action if necessary - the HMRC guidance is clear enough.
This does sound like quite a lot of hassle for your employees though - they have to find somewhere to leave your signwritten vehicle, and their own vehicle if they have one.
I'm not entirely convinced of the benefit of signwritten vehicles either, unless your business is the type of company that gets significant amounts of work from people ringing you up on spec (as perhaps a plumber might).
Added to that, I figure they look a bit, well, desperate. My thoughts whenever I see a salesman exit a signwritten car is usually "did he crash his usual car and have to take the company s
tter today? Did his wife take the car with her when she left him? Do the company pay him so badly that he can't afford a proper car?"
I'm not entirely convinced of the benefit of signwritten vehicles either, unless your business is the type of company that gets significant amounts of work from people ringing you up on spec (as perhaps a plumber might).
Added to that, I figure they look a bit, well, desperate. My thoughts whenever I see a salesman exit a signwritten car is usually "did he crash his usual car and have to take the company s
tter today? Did his wife take the car with her when she left him? Do the company pay him so badly that he can't afford a proper car?"IroningMan said:
Its no hassle for me: I'll write the policy, create the template mileage log, issue the cars and instructions and then enforce the policy with disciplinary action if necessary - the HMRC guidance is clear enough.
You also draw HMRC attention to you and your employees potentially causing a whole lot of hassle as they need convincing that what you are doing is OK. Amongst that is not just having the logs it's checking that they are correct, that when an employee claims 35 miles on one trip it really is 35 miles and not 31 giving them enough leeway to take themselves to the supermarket that evening or whatever. To someone who does a lot of work miles and not very many personal ones it's easy to pad work miles by 10%, for example and do without maybe a second car in the family and HMRC know it.Siscar said:
IroningMan said:
Its no hassle for me: I'll write the policy, create the template mileage log, issue the cars and instructions and then enforce the policy with disciplinary action if necessary - the HMRC guidance is clear enough.
You also draw HMRC attention to you and your employees potentially causing a whole lot of hassle as they need convincing that what you are doing is OK. Amongst that is not just having the logs it's checking that they are correct, that when an employee claims 35 miles on one trip it really is 35 miles and not 31 giving them enough leeway to take themselves to the supermarket that evening or whatever. To someone who does a lot of work miles and not very many personal ones it's easy to pad work miles by 10%, for example and do without maybe a second car in the family and HMRC know it.KD678 said:
I was speaking to an accountant recently about this, and they suggested that if the employee makes a contribution to the running of the vehicle, and it is available to a number of employees then it would be OK as a pool car? Anyone heard of this?
That would be the worst thing I can imagine doing. Why contribute to a pool car?Gassing Station | Business | Top of Page | What's New | My Stuff