Field Service Role - car allowance, costs etc.

[TheFungle]

Having been in the RAF for a good number of years I have made the decision to move into civilian employment, most likely as a Field Service Engineer doing servicey things.

In order that I fully know what I'm going into financially, I'm trying to calculate what my (vehicle) costs will be.

Potential cars available (as stated at interview) include 1 series, 3 series, A3, Octavia etc. so a nice, if slightly mundane choice, comfort will be a primary concern for me.

Given that the car is a necessity for the job will I be liable for the full BIK? Personal use will be allowed and I'd estimate that to be about 4k per year.

Googling would suggest that company funded personal fuel would not be the best for me with my limited personal mileage. I also assume that driving from home to customer is counted solely as business?

[SantaBarbara]

The company may offer you a company vehicle?

[Sheepshanks]

TheFungle said:

Given that the car is a necessity for the job will I be liable for the full BIK?

Yes.

TheFungle said:

Googling would suggest that company funded personal fuel would not be the best for me with my limited personal mileage.

Typical situation now is you get all fuel but then repay private mileage on a per mile basis. However you'll probably have to go with whatever system the employer uses.

TheFungle said:

I also assume that driving from home to customer is counted solely as business?

Yes.

[TheFungle]

Sheepshanks said:

TheFungle said:

Googling would suggest that company funded personal fuel would not be the best for me with my limited personal mileage.

Typical situation now is you get all fuel but then repay private mileage on a per mile basis. However you'll probably have to go with whatever system the employer uses.

Is that likely to leave me better or worse off than if I were simply paying for the fuel myself? I assume some manner of wear & tear is factored in?

[PorkInsider]

TheFungle said:

Sheepshanks said:

TheFungle said:

Googling would suggest that company funded personal fuel would not be the best for me with my limited personal mileage.

Typical situation now is you get all fuel but then repay private mileage on a per mile basis. However you'll probably have to go with whatever system the employer uses.

Is that likely to leave me better or worse off than if I were simply paying for the fuel myself? I assume some manner of wear & tear is factored in?

Not sure what you mean by factoring in wear and tear?

The 'normal' position would be that you just cover the fuel costs for your private mileage but that's up to the employer of course.

Have a look at one of the company car tax calculators to see how the tax works out with and without private fuel, etc.

http://comcar.co.uk/newcar/companycar/taxcalc/

HMRC fuel rates are here: https://www.gov.uk/government/publications/advisor...

As per previous poster, many companies have you pay for all fuel and then claim back the business use. It's impossible to say whether that's better or worse for you than the company paying and you refunding private mileage as it depends on whether the actual car does better or worse than the HMRC rates.

[Eric Mc]

Driving from home to work is normally NOT looked on as business travel. It is defined by HMRC as "the normal commute". If an employer pays you mileage for "the normal commute" - then that money received will constitute a taxable benefit in kind.

There are circumstances where a trip directly from home to a site MAY not be classified as a normal commute - but sometimes it is not always clear whether such a journey will be subject to a BIK or not.

[TheFungle]

Eric Mc said:

Driving from home to work is normally NOT looked on as business travel. It is defined by HMRC as "the normal commute". If an employer pays you mileage for "the normal commute" - then that money received will constitute a taxable benefit in kind.

There are circumstances where a trip directly from home to a site MAY not be classified as a normal commute - but sometimes it is not always clear whether such a journey will be subject to a BIK or not.

So if I travel from Leeds to Nottingham one day and Leeds to Newcastle the next day, are you saying they would be classed as a normal commute?

I fail to see how this can be the case given I would be classed as a home worker.

[mfmman]

TheFungle said:

Eric Mc said:

Driving from home to work is normally NOT looked on as business travel. It is defined by HMRC as "the normal commute". If an employer pays you mileage for "the normal commute" - then that money received will constitute a taxable benefit in kind.

There are circumstances where a trip directly from home to a site MAY not be classified as a normal commute - but sometimes it is not always clear whether such a journey will be subject to a BIK or not.

So if I travel from Leeds to Nottingham one day and Leeds to Newcastle the next day, are you saying they would be classed as a normal commute?

I fail to see how this can be the case given I would be classed as a home worker.

No, Eric is normally super accurate on these threads but may have missed 'Field Service Role' in the title and I don't think you have mentioned being home based (is this what you mean, home worker is something else again) until now.

Any journey to a place other than 'your place of work' will be fully business use in the eyes of HMRC, but employers are perfectly entitled to set their own rules and state that you must deduct a set number of miles daily, or the difference between the business journey and your home to their local office or anything else really. As per many other threads, you can have more than one place of work and any regular travel to a location can make it become a place of work (example, if you had to travel to the office every Monday that may be considered commuting by HMRC, AND your employer might decide it's at your expense)

You need to see your contract and the company drivers, car and expenses policies to decide what is what and make your decision

[clockworks]

I was a field engineer for 23 years. Ccar and fuel funding changed over that time as the 2 companies I worked for got smarter.

For the last few years, I had "car ownership scheme" cars, so no tax liability. Fully serviced as if it was a company car, but no BIK. I had to make a contribution to the company for private use though - around £60pcm for the cars that I chose. They offered a "base level car at £17pcm, with options to upgrade.

For most of the time I paid for my fuel, and reclaimed business miles on expenses. They introduced "reimburse" fuel cards, where I paid back my personal mileage (no tax liability) with the option of a normal fuel card.

I always managed to find a combination that gave me a free car with no tax liability. I was doing 40k miles a year, very low private mileage.
I was classed as home based, so all mileage was covered.

[Eric Mc]

mfmman said:

No, Eric is normally super accurate on these threads but may have missed 'Field Service Role' in the title and I don't think you have mentioned being home based (is this what you mean, home worker is something else again) until now.

Any journey to a place other than 'your place of work' will be fully business use in the eyes of HMRC, but employers are perfectly entitled to set their own rules and state that you must deduct a set number of miles daily, or the difference between the business journey and your home to their local office or anything else really. As per many other threads, you can have more than one place of work and any regular travel to a location can make it become a place of work (example, if you had to travel to the office every Monday that may be considered commuting by HMRC, AND your employer might decide it's at your expense)

You need to see your contract and the company drivers, car and expenses policies to decide what is what and make your decision

The point I was making is that the rules are quite complex and are sometimes open to interpretation. In recent years we have had a tax case known as "The Dr Samadian Case" which was all about what the definitions of "normal commute". It cost the doctor a fair bit of backdated tax and penalties.

[Sheepshanks]

clockworks said:

For the last few years, I had "car ownership scheme" cars, so no tax liability. Fully serviced as if it was a company car, but no BIK.

This is right scam which HMRC has mumbled about for years but hasn't actually taken any action. I think it is under review at the moment. Worth grabbing if you can though!

[mfmman]

Eric Mc said:

mfmman said:

No, Eric is normally super accurate on these threads but may have missed 'Field Service Role' in the title and I don't think you have mentioned being home based (is this what you mean, home worker is something else again) until now.

Any journey to a place other than 'your place of work' will be fully business use in the eyes of HMRC, but employers are perfectly entitled to set their own rules and state that you must deduct a set number of miles daily, or the difference between the business journey and your home to their local office or anything else really. As per many other threads, you can have more than one place of work and any regular travel to a location can make it become a place of work (example, if you had to travel to the office every Monday that may be considered commuting by HMRC, AND your employer might decide it's at your expense)

You need to see your contract and the company drivers, car and expenses policies to decide what is what and make your decision

The point I was making is that the rules are quite complex and are sometimes open to interpretation. In recent years we have had a tax case known as "The Dr Samadian Case" which was all about what the definitions of "normal commute". It cost the doctor a fair bit of backdated tax and penalties.

I certainly won't be trying to teach you to suck eggs here but Dr Samadian's case didn't have much in common with an employed field service role (self employed/multiple places of work from choice vs. employee and attendance at numerous customer locations without any self selection of attendance i.e. goes where he/she is sent). I was in a similar field role to the OP and we opted out of the company car scheme and ran our own cars, claiming a mileage allowance for business use. We also claimed a tax rebate on the difference between AMAP rates and the rate our employer paid. A change of policy came in and we were issued fuel cards instead with a requirement to calculate and pay for private use. Our employer advised us that we would not be eligible for tax relief, some investigation and contact with the tax office and it was confirmed they were incorrect. Really it was a jumped up fleet manager who didn't like the opt out option as it shrunk his little empire! HMRC advised to read Guide 490 which actually uses a Field Service Engineer as one of it's examples.

Whilst the OP is talking company car not opt out, I believe HMRC view on business use vs commuting/private use is the same regardless.

[Nickbrapp]

Sorry to bump a old thread.

I’m also a service tech, I live in South Wales and my contract states my office is in Halesowen, and that this is a field based role where I may be expected to travel to diffrent client sites each day ( which I do)

I have a Astra estate as a company car, with a fuel card, I DO NOT use it for ANY private miles as I have my own car and only use it to drive from home to clients sites which vary in distance.

I keep a millage log to show how many miles I do each week at the beginning and end of each day

I’m being taxed for this, according to this advice from HMRC, I shouldn’t be being charged any tax at all? HMRC have recently changed my tax code so that they are.

I know some say that to be exempt that the car must be returned to a office if a reasonable distance (its 120 miles)

I know of people with vans who are in the same situation and pay no tax and keep a millage log

The advice on the HMRC website is as below

[Sheepshanks]

...so - has your employer told you not to use the van for private use, and do they have a system in place for checking that you don't?

Main issue is that employers don't want to police this, as they'll get spanked by HMRC if you get caught out.


Maybe they've tightened up on this - I recall HMRC would just accept your word (poss backed up by mileage records) that you didn't use the car privately. I suppose these days it should be easier to do with telematics, but then you really would need to never use the vehicle privately.

Edited by Sheepshanks on Friday 20th July 12:58

[mfmman]

The rules on commuting are different for cars and vans.

I think you will need a letter from your employer stating that the car is not available for personal use. This is different to you just not using it as in the eyes of HMRC it is available for you to use so therefore a BIK. (Just imagine if your own car was in for bodywork repair, could you really honestly say you would go the bus to the shops or go in the Astra if it was available to use).

Don't forget personal use includes stuff like going via the gym on the way home from work or dropping by the supermarket to get your evening meal on the way to the customer site in the morning (not stopping at a cornershop to buy fags on the way into work though).

[Nickbrapp]

^ yes the personal use one is odd


On a van you’re aloud a little play like collecting a newspaper on the way to work or the odd trip to the dentist, but not in a car?

I’ve also read if you have a van for non private use you pay no tax at all as I though, regardless of the cost of the van, so you could have a top spec transporter well over £40k and pay nothing but I have a Astra ( which I had no choice in) worth 20k but then get taxed to not even use the bloody thing!

It doesn’t sound like I can get out of it, and I think il ask my employer for a van as they’ve just changed to transits and transit connects which are much nicer than the combos they used to offer

[Nickbrapp]

Sheepshanks said:

...so - has your employer told you not to use the van for private use, and do they have a system in place for checking that you don't?

Main issue is that employers don't want to police this, as they'll get spanked by HMRC if you get caught out.


Maybe they've tightened up on this - I recall HMRC would just accept your word (poss backed up by mileage records) that you didn't use the car privately. I suppose these days it should be easier to do with telematics, but then you really would need to never use the vehicle privately.

Edited by Sheepshanks on Friday 20th July 12:58

Well when I told them I don’t use it for personal use they sent me a standard fuel card where as other engineers have a repay card where they have to claim the business miles they’ve done in their company cards back and have the fuel they’ve spent diducted from their wage.

The other guy I know who doesn’t use his van just keeps the mileage log and has the same fuel card but they’ve never asked to see these records and yet he doesn’t get taxed

[andburg]

surely the point here is that the car is available for personal use meaning its taxable, whether you use it or not isnt the problem.

you would need to speak to your employer as they are the ones telling HMRC you have a company vehicle you can use outside work.

[mfmman]

Nickbrapp said:

^ yes the personal use one is odd


On a van you’re aloud a little play like collecting a newspaper on the way to work or the odd trip to the dentist, but not in a car?

I’ve also read if you have a van for non private use you pay no tax at all as I though, regardless of the cost of the van, so you could have a top spec transporter well over £40k and pay nothing but I have a Astra ( which I had no choice in) worth 20k but then get taxed to not even use the bloody thing!

It doesn’t sound like I can get out of it, and I think il ask my employer for a van as they’ve just changed to transits and transit connects which are much nicer than the combos they used to offer

In a van commuting is not considered personal use, in a car it is hence the difference.

I guess HMRC understand that employers like BT whose guys take vans home but don't have personal use (they might not now but I think did when the rules were introduced) don't want all 500 guys trying to park the vans at the depot every night to avoid tax

[Laplace]

mfmman said:

In a van commuting is not considered personal use, in a car it is hence the difference.

Not if you're, as many field service engineers are, "home based".