Fully expensed car
Discussion
I'm not up on the latest company car tax situation, apart from it's nowhere near as good as it was.
So I've applied for a job that has a fully expensed company car including private mileage,according to the recruitment agency.
Now that seems to against everything I've heard, surely I will need to pay some kind of tax on it?
Obviously will ask if I get an interview.
Anyway if somebody could just give me the brief outline of the private mileage situation I would be most grateful.
Thanks Andy.
So I've applied for a job that has a fully expensed company car including private mileage,according to the recruitment agency.
Now that seems to against everything I've heard, surely I will need to pay some kind of tax on it?
Obviously will ask if I get an interview.
Anyway if somebody could just give me the brief outline of the private mileage situation I would be most grateful.
Thanks Andy.
HMRC has lots of info on their website.
Cars are graded based on the co2 output the higher the output the higher the % of their list price that you are levied as "tax" this is worked into your tax code. IIRC Diesels attract a 3% extra penalty.
an example being something like.
Car A has a co2 of 116g.
Car A has a list price of £20,000
Employee is a 20% tax payer.
Tax code is something like + 100
Co car is something like 18% of £20000 @ 20% so in reality it costs you in real money £60 per month or £720 annually.
Your code yould change to something like K650
If you get a fuel card this attracts its own tax. Again only from memory but using same scenario as above it would be around £70 per month in real money.
So a low emission £20k car with fuel card will cost you about £130 per month all up, give or take.
Double it if you are a 40% tax payer.
Mine is about £347 I think. That is a C220 Exec Diesel for reference
Cars are graded based on the co2 output the higher the output the higher the % of their list price that you are levied as "tax" this is worked into your tax code. IIRC Diesels attract a 3% extra penalty.
an example being something like.
Car A has a co2 of 116g.
Car A has a list price of £20,000
Employee is a 20% tax payer.
Tax code is something like + 100
Co car is something like 18% of £20000 @ 20% so in reality it costs you in real money £60 per month or £720 annually.
Your code yould change to something like K650
If you get a fuel card this attracts its own tax. Again only from memory but using same scenario as above it would be around £70 per month in real money.
So a low emission £20k car with fuel card will cost you about £130 per month all up, give or take.
Double it if you are a 40% tax payer.
Mine is about £347 I think. That is a C220 Exec Diesel for reference
MrAndyW said:
Thanks for the reply Chipchap,especially as it is written in understandable English.
By the sound of it then private mileage would just be the tax I'd pay on the fuel card, if I'm understanding right.
What I mean is it actually "perk".
Is it a perk ? Yes and No. I pay about £140 per month within the overall amount because I have a fuel card. That is almost £1800 per year. Which will buy around 1320 litres of diesel. On my C220 that is around 13000 miles. The question then is do I do over 1000 miles per month personal mileage. The answer is not really.By the sound of it then private mileage would just be the tax I'd pay on the fuel card, if I'm understanding right.
What I mean is it actually "perk".
The alternative is to give up the card and return to keeping accurate mileage logs etc. The result may be a £40 per month saving. The reality is I cant be arsed for that amount to fill in forms and keep records etc.
A
Chipchap said:
Is it a perk ? Yes and No. I pay about £140 per month within the overall amount because I have a fuel card. That is almost £1800 per year. Which will buy around 1320 litres of diesel. On my C220 that is around 13000 miles. The question then is do I do over 1000 miles per month personal mileage. The answer is not really.
The alternative is to give up the card and return to keeping accurate mileage logs etc. The result may be a £40 per month saving. The reality is I cant be arsed for that amount to fill in forms and keep records etc.
A
I disagree, a newish car including fuel for £140 a month. No depreciation, no maintenance, insurance or tax, no capital purchase for you. I think if you get the right kind of car, like the C220 then your quids in. I own my car, no finance outstanding and I probably spend more than £140 a month in insurance, tax, maintenance annually. That's before I think about fuel!The alternative is to give up the card and return to keeping accurate mileage logs etc. The result may be a £40 per month saving. The reality is I cant be arsed for that amount to fill in forms and keep records etc.
A
I haven't had a company car since 2000, back then I worked for a large dot com and extravagant company cars were very much the order of the day - those days are gone and those who still opt for non tax efficient models today will be almost certainly be worse off.
markda said:
Chipchap said:
Is it a perk ? Yes and No. I pay about £140 per month within the overall amount because I have a fuel card. That is almost £1800 per year. Which will buy around 1320 litres of diesel. On my C220 that is around 13000 miles. The question then is do I do over 1000 miles per month personal mileage. The answer is not really.
The alternative is to give up the card and return to keeping accurate mileage logs etc. The result may be a £40 per month saving. The reality is I cant be arsed for that amount to fill in forms and keep records etc.
A
I disagree, a newish car including fuel for £140 a month. No depreciation, no maintenance, insurance or tax, no capital purchase for you. I think if you get the right kind of car, like the C220 then your quids in. I own my car, no finance outstanding and I probably spend more than £140 a month in insurance, tax, maintenance annually. That's before I think about fuel!The alternative is to give up the card and return to keeping accurate mileage logs etc. The result may be a £40 per month saving. The reality is I cant be arsed for that amount to fill in forms and keep records etc.
A
I haven't had a company car since 2000, back then I worked for a large dot com and extravagant company cars were very much the order of the day - those days are gone and those who still opt for non tax efficient models today will be almost certainly be worse off.
Presumably on top of the tax there is also a cash allowance foregone, meaning the total cost must be c£500-£600 ?
The Beaver King said:
Be careful with a fuel card that includes for personal mileage.
Unless you're driving something 'thirsty' or do approx 25-30k private miles a year, they generally cost more in tax than you would save.
Exactly. Make sure the private fuel you use costs more than the fuelcard tax. Otherwise, decline the free fuel and claim back you business miles fuel only at the HMRC set rates.Unless you're driving something 'thirsty' or do approx 25-30k private miles a year, they generally cost more in tax than you would save.
Make this decision before you get the car. If you get just one private mile of fuel paid for, you are liable for the whole "free fuel" tax charge for that year.
You will always be taxed but it depends on your circumstances what works out best.
Lots of company car websites will give you the figures but generally you'll be looking at at least £200 per month tax for the car and the fuel.
Bizarrely I would be worse off if my car was a company car. Even though I get no car allowance!
Lots of company car websites will give you the figures but generally you'll be looking at at least £200 per month tax for the car and the fuel.
Bizarrely I would be worse off if my car was a company car. Even though I get no car allowance!
Vee said:
I think he pays £347 TAX for the car including £140 of fuel.
Presumably on top of the tax there is also a cash allowance foregone, meaning the total cost must be c£500-£600 ?
Got it in one. My tax code is diluted by amount that works out at a real deduction of £347 per month which includes the fuel taxation. I place zero value on the car as it is a work tool.Presumably on top of the tax there is also a cash allowance foregone, meaning the total cost must be c£500-£600 ?
If I had a car allowance that would need to be c£600 pcm which would attract 40% taxation and 11.7% or thereabouts Nat Ins. Leaving around £300 +- but my tax code would be c£347 better off too. So I would then have around £647 to own and operate my own car. I could then have a fuel card and pay c£140 tax leaving me around £507 to buy and insure and run a car. Not my preferred method really
So I just stick with the current system
TwigtheWonderkid said:
blank said:
Bizarrely I would be worse off if my car was a company car. Even though I get no car allowance!
That's unusual. Unless you drive something like a 15 y/o Merc S500, that cost a grand but had a list price of £100KIt's because I have access to a cheap private lease scheme that includes everything except fuel and a fuel card.
So my fuel all counts as private but as it's 'my' car I can offset the business miles at 45p/25p. I do mostly business miles so end up with a tax deduction.
Last time I checked it worked out I'd be down by about £100 per month if I had the same Astra as a company car!
blank said:
TwigtheWonderkid said:
blank said:
Bizarrely I would be worse off if my car was a company car. Even though I get no car allowance!
That's unusual. Unless you drive something like a 15 y/o Merc S500, that cost a grand but had a list price of £100KIt's because I have access to a cheap private lease scheme that includes everything except fuel and a fuel card.
So my fuel all counts as private but as it's 'my' car I can offset the business miles at 45p/25p. I do mostly business miles so end up with a tax deduction.
Last time I checked it worked out I'd be down by about £100 per month if I had the same Astra as a company car!
TwigtheWonderkid said:
blank said:
TwigtheWonderkid said:
A lease deal that includes insurance!!!! That's a new one on me.
Yep, includes insurance and unlimited mileage, but that's obviously quite unusual so doesn't work for everyone!Gassing Station | Jobs & Employment Matters | Top of Page | What's New | My Stuff