Discussion
Afternoon Guys,
Something i know nothing about & PH being a wealth of knowledge i figured it best to ask here.
A change of roles within the company will mean i will soon be out on the road.
Initially i've been asked to use my own car, which would mean i need to sort my own insurance, tax, running costs, fuel etc.
I get pence per mile for this, i can't remember the actual figure but i think its circa 40 something pence up to 'X' amount of miles, then 20 something pence above that.
I would be doing an estimated 25-30k p/annum (this is based on previous people who've been employed in this role).
I'm not going to be in the 40% taxable income bracket, but i do work self-employed on a weekend evening.
I was told once i'd settled in i could have the option of a company car if i wanted, although i understand i have to take all this into account when doing tax returnes etc? Whereas i don't if i use my own car but claim the mileage back.
Current car is a fairly mundane '07 118 petrol with circa 80k on the clock.
What would work out financially better for me? As i really don't understand company cars etc.
Something i know nothing about & PH being a wealth of knowledge i figured it best to ask here.
A change of roles within the company will mean i will soon be out on the road.
Initially i've been asked to use my own car, which would mean i need to sort my own insurance, tax, running costs, fuel etc.
I get pence per mile for this, i can't remember the actual figure but i think its circa 40 something pence up to 'X' amount of miles, then 20 something pence above that.
I would be doing an estimated 25-30k p/annum (this is based on previous people who've been employed in this role).
I'm not going to be in the 40% taxable income bracket, but i do work self-employed on a weekend evening.
I was told once i'd settled in i could have the option of a company car if i wanted, although i understand i have to take all this into account when doing tax returnes etc? Whereas i don't if i use my own car but claim the mileage back.
Current car is a fairly mundane '07 118 petrol with circa 80k on the clock.
What would work out financially better for me? As i really don't understand company cars etc.
theguvernor said:
Afternoon Guys,
Something i know nothing about & PH being a wealth of knowledge i figured it best to ask here.
A change of roles within the company will mean i will soon be out on the road.
Initially i've been asked to use my own car, which would mean i need to sort my own insurance, tax, running costs, fuel etc.
I get pence per mile for this, i can't remember the actual figure but i think its circa 40 something pence up to 'X' amount of miles, then 20 something pence above that.
I would be doing an estimated 25-30k p/annum (this is based on previous people who've been employed in this role).
I'm not going to be in the 40% taxable income bracket, but i do work self-employed on a weekend evening.
I was told once i'd settled in i could have the option of a company car if i wanted, although i understand i have to take all this into account when doing tax returnes etc? Whereas i don't if i use my own car but claim the mileage back.
Current car is a fairly mundane '07 118 petrol with circa 80k on the clock.
What would work out financially better for me? As i really don't understand company cars etc.
You'll usually get 45p a mile for the first 10k miles and 25p per mile there afterwards, so if you do 30k miles a year you'll be able to claim about £9500 a year in fuel - assuming you're going to be doing mostly motorway miles and you'll get 35mpg from your car you'll need about £5000 of fuel to do it, so you're 'up' £4500 a year - but you're also responsible for paying the extra for business use on your insurance, maintenance and your car will depreciate heavily by adding 30k miles a year to it - in 3 years it will have covered 170k miles in total, which will make it a very hard sell. All your income from your PAYE role should be taxed at source but you will need to declare it on your self-assessment but your expenses won't factor in that. Something i know nothing about & PH being a wealth of knowledge i figured it best to ask here.
A change of roles within the company will mean i will soon be out on the road.
Initially i've been asked to use my own car, which would mean i need to sort my own insurance, tax, running costs, fuel etc.
I get pence per mile for this, i can't remember the actual figure but i think its circa 40 something pence up to 'X' amount of miles, then 20 something pence above that.
I would be doing an estimated 25-30k p/annum (this is based on previous people who've been employed in this role).
I'm not going to be in the 40% taxable income bracket, but i do work self-employed on a weekend evening.
I was told once i'd settled in i could have the option of a company car if i wanted, although i understand i have to take all this into account when doing tax returnes etc? Whereas i don't if i use my own car but claim the mileage back.
Current car is a fairly mundane '07 118 petrol with circa 80k on the clock.
What would work out financially better for me? As i really don't understand company cars etc.
As for the company car, it will entirely depend on the car, tax rules are based on Co2 output and you'll be paid about 18p a mile, personally my company car costs about 12p a mile to drive about (sad that I know that) and the little I 'make' on the fuel just about covers the BIK and I don't worry about buying tyres, servicing costs, insurance costs etc
Edited by P-Jay on Tuesday 16th September 15:57
P-Jay said:
You'll usually get 45p a mile for the first 10k miles and 25p per mile there afterwards, so if you do 30k miles a year you'll be able to claim about £9500 a year in fuel - assuming you're going to be doing mostly motorway miles and you'll get 35mpg from your car you'll need about £5000 of fuel to do it, so you're 'up' £4500 a year - but you're also responsible for paying the extra for business use on your insurance, maintenance and your car will depreciate heavily by adding 30k miles a year to it - in 3 years it will have covered 170k miles in total, which will make it a very hard sell.
As for the company car, it will entirely depend on the car, tax rules are based on Co2 output and you'll be paid about 18p a mile, personally my company car costs about 12p a mile to drive about (sad that I know that) and the little I 'make' on the fuel just about covers the BIK and I don't worry about buying tyres, servicing costs, insurance costs etc
Yeah i believe those figures of P/Mile were what i was told.As for the company car, it will entirely depend on the car, tax rules are based on Co2 output and you'll be paid about 18p a mile, personally my company car costs about 12p a mile to drive about (sad that I know that) and the little I 'make' on the fuel just about covers the BIK and I don't worry about buying tyres, servicing costs, insurance costs etc
I was really weighing up the options, the idea put forward by the MD was use your own car for a few months whilst you get the hang of the job, then if you want to go down the company car route we can address it.
My private mileage isn't even 8000 miles per year.
My thoughts were to keep the 1 series for a few months more (early part of next year) & trade it in for something mundane & boring like a diesel Focus or something of the like. (I have a bike for going fast if i want).
Company cars are very heavily taxed these days. Hence the popularity of relatively eco-weenie models which attract the lowest levels of taxation. But you can wave goodbye to any ideas of "performance". Most of the major manufacturers sell models targeted specifically into this market. Not my cup of tea but you can have something shiny on the drive.
What you have been offered is almost certainly the HMRC tax-free car allowance of 45p a mile up to 10,000 miles and 25p a mile above that level. The HMRC allowance is, surprise surprise, intended to pay in full for the same sort of eco-weenie car as mentioned above.
In the real world the HMRC allowance will pay for either (a) a brand new eco-weenie, or (b) a reasonably reliable used car that you might actually want to own.
Most people who want a "nice" car simply buy a car they want and then treat the HMRC mileage allowance as a contribution towards their overall running costs. You certainly won't get fat on it!
What you have been offered is almost certainly the HMRC tax-free car allowance of 45p a mile up to 10,000 miles and 25p a mile above that level. The HMRC allowance is, surprise surprise, intended to pay in full for the same sort of eco-weenie car as mentioned above.
In the real world the HMRC allowance will pay for either (a) a brand new eco-weenie, or (b) a reasonably reliable used car that you might actually want to own.
Most people who want a "nice" car simply buy a car they want and then treat the HMRC mileage allowance as a contribution towards their overall running costs. You certainly won't get fat on it!
Qwert1e said:
Company cars are very heavily taxed these days. Hence the popularity of relatively eco-weenie models which attract the lowest levels of taxation. But you can wave goodbye to any ideas of "performance". Most of the major manufacturers sell models targeted specifically into this market. Not my cup of tea but you can have something shiny on the drive.
What you have been offered is almost certainly the HMRC tax-free car allowance of 45p a mile up to 10,000 miles and 25p a mile above that level. The HMRC allowance is, surprise surprise, intended to pay in full for the same sort of eco-weenie car as mentioned above.
In the real world the HMRC allowance will pay for either (a) a brand new eco-weenie, or (b) a reasonably reliable used car that you might actually want to own.
Most people who want a "nice" car simply buy a car they want and then treat the HMRC mileage allowance as a contribution towards their overall running costs. You certainly won't get fat on it!
As long as it covers 'everything' i'm not really all that phased, new isn't of interest to me, i don't see the fascination with new cars, i'd rather by something used thats a few years old! I was hoping by having the money from the HMRC allowance etc that it would work out it'd cover my usage for work, private with a little left over for a holiday or something at the end of the year, i know i won't get rich from it.What you have been offered is almost certainly the HMRC tax-free car allowance of 45p a mile up to 10,000 miles and 25p a mile above that level. The HMRC allowance is, surprise surprise, intended to pay in full for the same sort of eco-weenie car as mentioned above.
In the real world the HMRC allowance will pay for either (a) a brand new eco-weenie, or (b) a reasonably reliable used car that you might actually want to own.
Most people who want a "nice" car simply buy a car they want and then treat the HMRC mileage allowance as a contribution towards their overall running costs. You certainly won't get fat on it!
Personally I would (and have) go down the company car route long term.
You will indeed get taxed; but you won't need to pay road tax, insurance, servicing, tyres, wear and tear etc.
I have a Vauxhall Insignia 2.0 diesel, it's fully kitted out (sat nav, sports pack, AC, cruise control, DAB radio etc) and it costs me circa £4k a year BiK. It is in the 99 g/km bracket and gets 55mpg.
There are plenty of online guides that you can input your details and it will tell you whether a company car is more cost effective than using private.
You will indeed get taxed; but you won't need to pay road tax, insurance, servicing, tyres, wear and tear etc.
I have a Vauxhall Insignia 2.0 diesel, it's fully kitted out (sat nav, sports pack, AC, cruise control, DAB radio etc) and it costs me circa £4k a year BiK. It is in the 99 g/km bracket and gets 55mpg.
There are plenty of online guides that you can input your details and it will tell you whether a company car is more cost effective than using private.
Sheepshanks said:
30K/yr is hard on a car though - especially one already well used, like yours. It'll pick up all sort of problems, niggles and damage.
Asking someone to do that in their own car is taking the piss, especially a 20% tax payer where taking a company car, if offered, if a no-brainer.
To be fair - the MD is offering the opportunity for OP to go down the company car route after a few months ("if yyou want to go down the company car route we can address it")Asking someone to do that in their own car is taking the piss, especially a 20% tax payer where taking a company car, if offered, if a no-brainer.
I agree that expecting someone to do 30 k business miles in their own car is a pisstake - especially given the lack of reliability of modern diesels - which is what most people will go with for 30 k miles a year
Does the company have any pool cars that you can use for the interim period or a short term rental from Hertz or similar?
I also agree that being expected to use your own car to do that expected annual mileage is a joke. I would want it as part of the promotion from the start. If they are so confident about the promotion then why are they going to 'wait and see'?
I also agree that being expected to use your own car to do that expected annual mileage is a joke. I would want it as part of the promotion from the start. If they are so confident about the promotion then why are they going to 'wait and see'?
theguvernor said:
but i do work self-employed on a weekend evening.
If you go for a company car, the insurance it comes with will cover your employer's business use and usually pleasure use for the vehicle. But it will not usually cover you to use the car for any other business purposes.It's a family company, my old man being the boss.
The initial few months will be a training period, spending time with other people within the company to learn the basics of the job, most of this time will be spent driving to meet colleagues to visit customer etc.
Not doing vast amounts of miles.
30K a year in mileage i think is the top end it could possibly be, i would expect it realistically to be 25k.
I've been told after the initial training period then the option of a car will be there, of the other employees on the road all but have company cars, the other chap uses his own & takes the mileage allowance for it.
The initial few months will be a training period, spending time with other people within the company to learn the basics of the job, most of this time will be spent driving to meet colleagues to visit customer etc.
Not doing vast amounts of miles.
30K a year in mileage i think is the top end it could possibly be, i would expect it realistically to be 25k.
I've been told after the initial training period then the option of a car will be there, of the other employees on the road all but have company cars, the other chap uses his own & takes the mileage allowance for it.
Yeah, it sounds like the MD wants to have a few months of mutual bedding in time before he signs up to a 3 year lease on a company car.
As for the company car tax thing, mine costs me about a grand a year in BIK for a fully loaded Seat Exeo diesel and I'm hovering just below 40% - actually my MD upped my salary the day it arrived so I didn't actually suffer any loss (he's a nice guy) even if he didn't and I tip over 40% it would only be £160 a month - not pocket change I know, but my car insurance used to cost me £80 a month, then there's the VED, the tyres, servicing etc etc and it costs me 6p a mile less in fuel than I can claim back - it really was a no brainer - yes I have to have a diesel, but I didn't need to take one of those 100bhp super-eco diesels to make it work and it's a nice car - heaven forbid, I actually like the way it makes it's power for the type of driving I do - are modern diesel horribly unreliable? I don't think so, not new ones that do a decent amount of mileage anyway.
As for the company car tax thing, mine costs me about a grand a year in BIK for a fully loaded Seat Exeo diesel and I'm hovering just below 40% - actually my MD upped my salary the day it arrived so I didn't actually suffer any loss (he's a nice guy) even if he didn't and I tip over 40% it would only be £160 a month - not pocket change I know, but my car insurance used to cost me £80 a month, then there's the VED, the tyres, servicing etc etc and it costs me 6p a mile less in fuel than I can claim back - it really was a no brainer - yes I have to have a diesel, but I didn't need to take one of those 100bhp super-eco diesels to make it work and it's a nice car - heaven forbid, I actually like the way it makes it's power for the type of driving I do - are modern diesel horribly unreliable? I don't think so, not new ones that do a decent amount of mileage anyway.
P-Jay said:
Yeah, it sounds like the MD wants to have a few months of mutual bedding in time before he signs up to a 3 year lease on a company car.
As for the company car tax thing, mine costs me about a grand a year in BIK for a fully loaded Seat Exeo diesel and I'm hovering just below 40% - actually my MD upped my salary the day it arrived so I didn't actually suffer any loss (he's a nice guy) even if he didn't and I tip over 40% it would only be £160 a month - not pocket change I know, but my car insurance used to cost me £80 a month, then there's the VED, the tyres, servicing etc etc and it costs me 6p a mile less in fuel than I can claim back - it really was a no brainer - yes I have to have a diesel, but I didn't need to take one of those 100bhp super-eco diesels to make it work and it's a nice car - heaven forbid, I actually like the way it makes it's power for the type of driving I do - are modern diesel horribly unreliable? I don't think so, not new ones that do a decent amount of mileage anyway.
When I meant poor reliability - I meant the potential for big bills - if you were running your own car for 30 k miles.As for the company car tax thing, mine costs me about a grand a year in BIK for a fully loaded Seat Exeo diesel and I'm hovering just below 40% - actually my MD upped my salary the day it arrived so I didn't actually suffer any loss (he's a nice guy) even if he didn't and I tip over 40% it would only be £160 a month - not pocket change I know, but my car insurance used to cost me £80 a month, then there's the VED, the tyres, servicing etc etc and it costs me 6p a mile less in fuel than I can claim back - it really was a no brainer - yes I have to have a diesel, but I didn't need to take one of those 100bhp super-eco diesels to make it work and it's a nice car - heaven forbid, I actually like the way it makes it's power for the type of driving I do - are modern diesel horribly unreliable? I don't think so, not new ones that do a decent amount of mileage anyway.
If someone else is taking the hit for the bills - they aren't such an issue
For that mileage then I would go company car route.
Just looking at the VW site, a Golf GT TDi 150 is taxed at £68 per month for the first year for a 20% tax payer.
BMW, a 220d SE is about £90 per month
Ford Focus 2.0 TDCi Titanium Nav is £73
So depending what car they will let you have its not a huge amount to pay out in tax.
Just looking at the VW site, a Golf GT TDi 150 is taxed at £68 per month for the first year for a 20% tax payer.
BMW, a 220d SE is about £90 per month
Ford Focus 2.0 TDCi Titanium Nav is £73
So depending what car they will let you have its not a huge amount to pay out in tax.
Gassing Station | General Gassing | Top of Page | What's New | My Stuff