Electric Cars bought by Company - RK and Insurance queries

[xerawh]

Hi all,

I've searched PH but haven't come up with a recent explanation on this (or badly searched) so bear with me and appreciate knowledgeable input here. I know I should ask my accountant, however they don't have much experience with this and not keen to change because of this single 'hurdle'. It's also a first for us so struggling with various info on the net on this.

My brother and I own and are directors of a limited company (trading). Due to needing new cars and the beneficial EV tax regime, we are buying 2 EVs through this company (in cash if that makes a difference).

My brother is employed by the company and works for them, will be using his car for commuting to work and private use. I am just a director/shareholder and the car is purely for personal use.

Some key questions here:

(1) Who do we put as Registered Keeper?

Does it have to be the company to ensure we get to claim the 100% tax allowance or does it not matter? Is there any benefit from an insurance perspective? I know the difference re owner (clearly Company) and RK (not necessarily owner), just trying to work out the right entity/person to put as RK - we have no issue with either, but important we are able to claim the tax allowance.

(2) What's the best way to insure this - personal insurance or a fleet? Previous posts on fleet seemed to suggest makes sense for 4+ cars but we've never used this or know where to start.

(3) Any good PHers here involved as brokers that we can approach as happy to use them and seek their advice to make this cost-efficient.

Thanks all.

[mmm-five]

Is the company buying these cars as a gift to the both of you, or are you expecting to pay some huge BIK for the 100% personal use?

[xerawh]

BIK is at 2% so talking a few hundred pounds. This is ok even for personal use.

[NDA]

I am not an accountant - and you should check with your accountant!

However....

I bought my EV through my small consultancy company. It is registered in the company's name and I made sure that Direct Line insure it as 'not owned by the policyholder' which they did without any questions or issues.

It's probably not that important, but I made sure I paid for the car from the company account - same with the insurance. The card that the car is linked to for supercharging is also the company card.

Happy to email you the insurance and registration documents if it helps.

[xerawh]

NDA said:

I am not an accountant - and you should check with your accountant!

However....

I bought my EV through my small consultancy company. It is registered in the company's name and I made sure that Direct Line insure it as 'not owned by the policyholder' which they did without any questions or issues.

It's probably not that important, but I made sure I paid for the car from the company account - same with the insurance. The card that the car is linked to for supercharging is also the company card.

Happy to email you the insurance and registration documents if it helps.

Thanks NDA , that's helpful and in line what what I understand from various sources as possible. I'd your insurance policy a personal policy (as if insuring a private car, just a different owner)? Or is there a business insurance route with Direct Line?

[NDA]

The policy, I have it front of me, is me as the policy holder, but contains the wording:

"Mr NDA who is neither the legal owner nor the registered keeper of the car".

Does that help?

[xerawh]

Yes, sounds like the company is the registered keeper (as well as owner).

[NDA]

xerawh said:

Yes, sounds like the company is the registered keeper (as well as owner).

Exactly. But the policy is in my name, not the company's name of course.

[Insurancejon]

NDA said:

xerawh said:

Yes, sounds like the company is the registered keeper (as well as owner).

Exactly. But the policy is in my name, not the company's name of course.

Are your insurers aware who actually owns the car? On the statement of fact they generally expect the policy holder to be the owner….and most don’t like it being owned by the company (not saying it’s impossible, but usually it’s very hard)

This also creates another issue, the company won’t have any NCD.

[NorthDave]

Is it not the same as when the company leases a car for a director? When I have done that I have insured personally (using my NCD etc) but just stated I dont own the car etc. Never seems to be a problem.

I suspect you are overthinking it - the insurance guys must see this all the time? I think the owner can be your limited company with registered keeper the person who insures it.

[Sheepshanks]

NorthDave said:

Is it not the same as when the company leases a car for a director? When I have done that I have insured personally (using my NCD etc) but just stated I dont own the car etc. Never seems to be a problem.

This has cme up a few times and people say they do the above and it's fine.

Maybe insurers don't care or perhpas it's a loophole, but if the company owns or leases the car and you insure it in the company name it'll be like 4x the cost of you doing it in your own name. It doesn't make a lot of sense that insurers allow people to work around that.

[NDA]

Insurancejon said:

NDA said:

xerawh said:

Yes, sounds like the company is the registered keeper (as well as owner).

Exactly. But the policy is in my name, not the company's name of course.

Are your insurers aware who actually owns the car? On the statement of fact they generally expect the policy holder to be the owner….and most don’t like it being owned by the company (not saying it’s impossible, but usually it’s very hard)

This also creates another issue, the company won’t have any NCD.

Yes, the insurers (Direct Line) are fully aware that the car is owned by my company - which is why the policy is worded in the way that it is. I have 9+ years of NCD, which I claiming on this policy as the policy is in my name. None of this was a problem for Direct Line, very easy to deal with and gave me the policy I needed.

[MattyD803]

Insurancejon said:

Are your insurers aware who actually owns the car? On the statement of fact they generally expect the policy holder to be the owner….and most don’t like it being owned by the company (not saying it’s impossible, but usually it’s very hard)

This is no different to leasing a vehicle privately, which I have done on my last 5 cars over a 10 year period.....I have used Direct Line, Aviva, Admiral and LV for the insurance of these vehicles and they all have a simple drop down menu where you can select "Registered Keeper" and "Legal Owner".

In all 5 cases, I have been neither been the registered keeper or indeed legal owner of my lease vehicles and this has caused zero problems. Instead, you simply chose as "Other" / "Lease Company - Privately Leased". Or if the Ltd Company owns the car outright, it would be "Company Car", or similar. Never been an issue or difficult to administer, although I cannot comment on whether it affects the premium. (Mine have never been expensive, considering the cars value often being £40k+).

Insurancejon said:

This also creates another issue, the company won’t have any NCD.

I would suggest that the policy holder would set the policy up in their own name (not the company's name, as the company is not the insured risk) and therefore accrue No Claims Discount, no differently to a personally owned vehicle, again exactly as per my leasing example. By ensuring that the insurance policy covers only the vehicle owned by the company, this is all squared away.

Edited by MattyD803 on Tuesday 8th March 12:20

[Insurancejon]

I'm not saying you can't do it, I'm not saying some insurers don't do it.


What you have be careful of, which it seems you have been on yours, is not to assume its all ok and just do it.....I've seen a lot of people come unstuck by not discussing the actual ownership of the vehicle with their insurer or broker

[xerawh]

thanks all.

in conclusion, it sounds like the most cost-effective approach is to have the company as 'owner' and individual as 'registered keeper'.

this is subject to making it clear to the insurance company this is the set up - it's a contract of good faith and if you can evidence you told the insurance company this (ie. in writing or on your schedule), i think that works

[lizardbrain]

When I asked direct line, they said they were not interested in who owned the car - Company or otherwise.

[surveyor]

LV were similar.

[RamraiderVVC]

I have done exactly this very recently (February 2022) and also got the advice from my accountant.

I was told the car has to be in the company name (i would have expected this tbh) so that's what i did.

Now this is the more interesting bit perhaps - I was insured by Direct line, but when I wanted to move my insurance of my personally leased car, i was told the DL no longer deal with company owned cars. I had to cancel the insurance and take out another one (Admiral i went with after doing the compare job). DL apologised that they no longer help with insuring the new company owned car and then paid me back roughly half of the insurance money.

I would want to check all is fully covered and understood.

M

[xerawh]

Thanks ramraider. Did you also put your company as registered keeper in the V5?

[springfan62]

Make sure the purchase invoice is in the company name, that will establish proof of ownership for tax purposes, the registered keeper is not relevant to ownership.