Who gets company cars?
Discussion
You can turn down a pay rise.
Deva Link said:
That (tax on the car doubling) would only apply if his pay rise was worth more than the BIK value of the car.
The BIK value gets added to your gross salary so for what you wrote to be correct, he must have been way under the 40% theshold before his pay rise.
Also, the 40% theshold is lower, but the personal allowance has gone up by the same amount so they cancel each other out.
The BIK value gets added to your gross salary so for what you wrote to be correct, he must have been way under the 40% theshold before his pay rise.
Also, the 40% theshold is lower, but the personal allowance has gone up by the same amount so they cancel each other out.
chrisxr2 said:
i wonder often how many people buy a car from a dealer and don't realise its been a daily hack for a few months.
We tell the truth. Nothing to hide ~ quite often the sales guys will come over for my car for a demo drive with a customer. It will have my stuff in it, cds, phone chargers etc and my house keys on a West Ham key ring!!. We find most people respond positively to honesty. I don`t do huge mileage and don`t drive it like I stole it either ~ I look after it and often clean it myself at home. Hammer67 said:
I get one, usually whatever is on the demo fleet. Have had literally dozens over the years. Regularly get to work to find someone`s sold it and off it goes. I then spend the day rooting around for something to go home in. I only really use it for work, long trips up north or family holidays. Rest of the time I use one of my toys.
I'm an Associate in the Architecture dept of a large uk based design and engineering firm and have the choice of company car or car allowance.
I have always taken the allowance, year on year. I have previously leased cars privately as I could get more for the monthly money than through a company car after tax, but in an industry heavily hit by redundnancy over the last 3 years, a long ball and chain private lease is less attractive than a company car that would simply go back if the worst came to the worst...
Currently, as the wife an I both outright own both of our cars it's a no brainer to take the money. We purposely "downspecced" one car to get into that position.
My "Maz" might now temporarily be an '04 Mazda 6 Sport rather than a Maserati but the money's in the bank should we return to more frivolous, more secure times! Despite only intending to have the Mazda for 12 months, I've grown quite attached to it, and love the fact that I once paid more for a new clutch than I did on this entire car! Not quite bangernomics as I need reliability for work (terms of the cars allowance) and for a young child... but almost.
NB: Sorry to dissapoint on the stereotype, but I've never (yet) owned a SAAB!
I have always taken the allowance, year on year. I have previously leased cars privately as I could get more for the monthly money than through a company car after tax, but in an industry heavily hit by redundnancy over the last 3 years, a long ball and chain private lease is less attractive than a company car that would simply go back if the worst came to the worst...
Currently, as the wife an I both outright own both of our cars it's a no brainer to take the money. We purposely "downspecced" one car to get into that position.
My "Maz" might now temporarily be an '04 Mazda 6 Sport rather than a Maserati but the money's in the bank should we return to more frivolous, more secure times! Despite only intending to have the Mazda for 12 months, I've grown quite attached to it, and love the fact that I once paid more for a new clutch than I did on this entire car! Not quite bangernomics as I need reliability for work (terms of the cars allowance) and for a young child... but almost.
NB: Sorry to dissapoint on the stereotype, but I've never (yet) owned a SAAB!
In my last job I had a company car. BMW 120D 'M'sport.
I got a good deal from the company, they paid all the fuel and the tax benefit on that worked in my favour big time. They weren't too pleased with the 35k miles per year, with only 1/3 of that being for business! They never knew that I'd had it chipped too!
I got a good deal from the company, they paid all the fuel and the tax benefit on that worked in my favour big time. They weren't too pleased with the 35k miles per year, with only 1/3 of that being for business! They never knew that I'd had it chipped too!
Deva Link said:
The way you work it out makes no difference - in practice you do take the BIK value from your personal allowance but all that does is lower the level at which you pay higher rate tax. You only pay higher rate tax on your taxable income (including the BIK value) over the threshold. If the total is 1K over then you pay higher rate tax on 1K
You never pay co car tax at two levels - if, after the BIK is taken in to account you are classed as a 40% tax payer then you pay you co car tax at 40%. Hence the step. I work in IT support, covering the whole of the UK.
Very small list of cars to choose from, but I do get all fuel paid (private and business). To be honest my private fuel bill would be more than the tax I pay for the fuel and the car.
Company did try to buy me out with an allowance, but it would have been a bad move for me due to private miles.
New car every 3 years.
When I worked in the motor trade (back in the 80's) I got a new car every 3 months, or sooner if my 'demo' was sold. In reality I could use anything that was taxed.
Very small list of cars to choose from, but I do get all fuel paid (private and business). To be honest my private fuel bill would be more than the tax I pay for the fuel and the car.
Company did try to buy me out with an allowance, but it would have been a bad move for me due to private miles.
New car every 3 years.
When I worked in the motor trade (back in the 80's) I got a new car every 3 months, or sooner if my 'demo' was sold. In reality I could use anything that was taxed.
Super Injunction said:
You never pay co car tax at two levels - if, after the BIK is taken in to account you are classed as a 40% tax payer then you pay you co car tax at 40%. Hence the step.
Rubbish. Co Car Tax is a Benefit in Kind, which in effect is income. So if you earn say 43k before the BIK is added, and the taxable car value is 6k it is most likely you will straddle the 2 tax brackets and therefore the car is taxable at the 2 rates of 20% and 40%.audi321 said:
Rubbish. Co Car Tax is a Benefit in Kind, which in effect is income. So if you earn say 43k before the BIK is added, and the taxable car value is 6k it is most likely you will straddle the 2 tax brackets and therefore the car is taxable at the 2 rates of 20% and 40%.
Do you have a company car? http://www.parkers.co.uk/company-cars/news-and-adv...
The BIk takes away from your tax free allowances. If, after this is taken into consideration, you are classed as a 40% taxpayer, you pay the whole benefit at this level. Hence on the revenue website for calculating your tax burden it doesn't ask how much the car pushes you into the bracket, it simply asks 40% tax payer or not. The above link and a million others will explain it in the same way.
A family member went through a brief stint of getting a new Range Rover every 6 months. I think he was a sales manager for Range Rover at the time.
They've changed jobs and now has the hard task of selling cars to people in Dubai! I have no idea what the company car is now, but I know they get given a company house!
They've changed jobs and now has the hard task of selling cars to people in Dubai! I have no idea what the company car is now, but I know they get given a company house!
Super Injunction said:
You never pay co car tax at two levels - if, after the BIK is taken in to account you are classed as a 40% tax payer then you pay you co car tax at 40%. Hence the step.
Honestly, as audi321 also says, you're wrong.There's no such thing as car tax (well, apart from that thing you stick in the windscreen).
It's just tax. Personal allowance this year 7475 and you pay 20% on the first 35000 of taxable income then 40% from 35001.
Say you have a car with a P11D value of 20000 and its tax rate, based on emissions, is 15%, so it has a BIK value of 3000. You don't get private fuel.
Say your salary is 40475.
Your personal allowance is 7475 - the BIK value 3000 = 4475.
Your taxable income is 40475 - 4475 = 36000
So you pay 20% tax on the first 35000 and then 40% tax on the other 1000.
Flanders. said:
Slightly off topic but we're allowed to take our Company Vans home at night. Although we're not allowed to use them outside of Company time 
. How comes I don't have to pay any Tax on it, surely its no different than someone who has a Car?
Because you don't ( . How comes I don't have to pay any Tax on it, surely its no different than someone who has a Car? ) do any private miles so it's not classed as a taxable benefit.HMRC does allow van users to make a small amount of private use though.
There is always the 'company car park' thing, but it doesn't bother me. I think the days of seniority and rank having to be 'on display' are long gone. Anyone who still does think like that is the one who normally rushes out and gets the latest german saloon with the smallest diesel engine and the biggest wheels available - not my idea of money well spent, but hey ho, it's not my money they are spending so good luck to 'em and hope they enjoy it.
I used to run company cars. Was a good perk before the tax was based on Co2 as it got my into some 'nice' cars when I was younger and could not have afforded to buy myslef. But now I'll always take the cash option regardless of the miles I do.
Suits me much better to split the funds up to have a toy in the garage (currently as Caterham) and a daily beater to pile the miles on (currently a 3k Passat) than to have an 'executive' car on my driveway suckling away at my disposable.
I used to run company cars. Was a good perk before the tax was based on Co2 as it got my into some 'nice' cars when I was younger and could not have afforded to buy myslef. But now I'll always take the cash option regardless of the miles I do.
Suits me much better to split the funds up to have a toy in the garage (currently as Caterham) and a daily beater to pile the miles on (currently a 3k Passat) than to have an 'executive' car on my driveway suckling away at my disposable.
Flanders. said:
Slightly off topic but we're allowed to take our Company Vans home at night. Although we're not allowed to use them outside of Company time . How comes I don't have to pay any Tax on it, surely its no different than someone who has a Car?
It is different - tax on company cars is payable because they are available for private use. . How comes I don't have to pay any Tax on it, surely its no different than someone who has a Car?This came up earlier in thread from someone who has a co car but doesn't use it privately - doesn't matter, the fact that it's available means the tax is due.
In your case the van isn't available for private use, so there's no tax.
Be careful here is you do use it now and again - not for tax reasons, but the insurance probably won't be valid.
ks. The percentage of your wage pay as co car tax depends on the car emissions etc. The amount of tax you pay is therefore a function of that and the amount you earn. Tax threshold has no effect and anybody saying it does needs to have a read up. Gassing Station | General Gassing | Top of Page | What's New | My Stuff