Company Car vs Own Car
Discussion
Have I got this right???
My tax rate is the standard 20% so:
COMPANY CAR
Car: VW Golf SE Nav 2.0 litre Manual 2017
P11D: £23,465
CO2: 109g/km
BiK Rate: 23%
Company Car Cost: £1,099.80
Private Fuel Set Rate: £22,600
BiK Rate: 23%
Fuel Allowance Cost: £1,059.26
Overall Cost for VW Golf Company Car: £2,159.07 per year
OWN CAR
Car: Ford Focus 2010
Rough MPG: 37
Annual Mileage: 18,150
Claimable Mileage: 7,700 (not including commute)
At Company's 15p Rate: £1,115
At HMRC's 30p Rate: £2,310
Annual Fuel Outlay: £2,760
Car depreciation over 18k miles in 1 year: £750
MOT, Tax, Insurance, Roadside Cover: £750
Overall Cost for Ford Focus Own Car: £835.00 per year
If this is correct - why would I want a company car???
My tax rate is the standard 20% so:
COMPANY CAR
Car: VW Golf SE Nav 2.0 litre Manual 2017
P11D: £23,465
CO2: 109g/km
BiK Rate: 23%
Company Car Cost: £1,099.80
Private Fuel Set Rate: £22,600
BiK Rate: 23%
Fuel Allowance Cost: £1,059.26
Overall Cost for VW Golf Company Car: £2,159.07 per year
OWN CAR
Car: Ford Focus 2010
Rough MPG: 37
Annual Mileage: 18,150
Claimable Mileage: 7,700 (not including commute)
At Company's 15p Rate: £1,115
At HMRC's 30p Rate: £2,310
Annual Fuel Outlay: £2,760
Car depreciation over 18k miles in 1 year: £750
MOT, Tax, Insurance, Roadside Cover: £750
Overall Cost for Ford Focus Own Car: £835.00 per year
If this is correct - why would I want a company car???
I'm not a massive fan of having a brand new car... its too showy and I worry about bouncing it off other cars / street furniture / people.
Then again, it keeps me in check and stops me rolling up outside client's offices in a beat up car looking like I don't give a damn. But I could pay someone to clean my car every week and still have change from the money I would save.
Like I said, I do about 7,700 business mileage plus about 10,450 personal miles (including commuting). 10,450 of personal mileage does add up to about the same as the private fuel allowance costs me so I'm not losing out there - in fact if I bought my own car it would be less fuel efficient so cost me more.
As I'm a sub-30 year old professional in a market which really laps up the whole image = power thing I guess it makes sense for me to stick with the company car. But I just don't see why it's seen as such a 'benefit' these days.
I guess at least it gets me out of doing a self assessment tax form...
Then again, it keeps me in check and stops me rolling up outside client's offices in a beat up car looking like I don't give a damn. But I could pay someone to clean my car every week and still have change from the money I would save.
Like I said, I do about 7,700 business mileage plus about 10,450 personal miles (including commuting). 10,450 of personal mileage does add up to about the same as the private fuel allowance costs me so I'm not losing out there - in fact if I bought my own car it would be less fuel efficient so cost me more.
As I'm a sub-30 year old professional in a market which really laps up the whole image = power thing I guess it makes sense for me to stick with the company car. But I just don't see why it's seen as such a 'benefit' these days.
I guess at least it gets me out of doing a self assessment tax form...
Gareth1974 said:
Unless I've missed it, I don't think you've included service costs or tyres in the sums for your own car.
Well spotted Gareth,Tyres - 4 per year @ £80 = £320
Oil, gaskets, filters = £150
Bearings, brakes & fluids = £150
Bulbs, fuses & plugs = £50
Total annual cost £670
Added to the original annual cost of £835 = £1,505
Still £650 short of company car cost but as already pointed out the two cars aren't really comparable... Having said that I've already allowed £750/year depreciation on what is probably a £3k car which is pretty harsh.
interstellar said:
ref this bit
"At HMRC's 30p Rate: £2,310"
you dont get £2310 back you get tax relief on this amount so in your case (20% tax payer) you can claim £462. That changes things.
Aha!!!! Thank you for this interstellar!!!"At HMRC's 30p Rate: £2,310"
you dont get £2310 back you get tax relief on this amount so in your case (20% tax payer) you can claim £462. That changes things.
I knew I must be missing something!
This makes more sense now....
OWN CAR
Car: Ford Focus 2010
Rough MPG: 37
Annual Mileage: 18,150
Claimable Mileage: 7,700 (not including commute)
At Company's 15p Rate: £1,115
At 20% of HMRC's 30p Rate: £462
Annual Fuel Outlay: £2,760
Car depreciation over 18k miles in 1 year: £750
MOT, Tax, Insurance, Roadside Cover: £750
Maintenance & Tyres: £670
Overall Cost for Ford Focus Own Car: £3,353 per year
That makes the £2,160 annual cost of a company car much more appealing...
The company are not offering any cash alternative so this really hits it home that a company car is the way to go.
Like andburg says - smallest motor with highest trim - hence the SE Nav model of Golf rather than a GTD as some of my colleagues have chosen.
It's an open book - I can have any car. I've picked out the Golf because it's small and has good visibility out the back for reversing (lots of city parking for work), the boot is big enough for my Labrador and it's not too sporty (too many points on my license already).
Only thing that puts me off it is the fact I wont be able to fit my bike in the boot without removing a wheel and roofbars would look ugly and cause problems long term because they mount through the door openings.
Like andburg says - smallest motor with highest trim - hence the SE Nav model of Golf rather than a GTD as some of my colleagues have chosen.
It's an open book - I can have any car. I've picked out the Golf because it's small and has good visibility out the back for reversing (lots of city parking for work), the boot is big enough for my Labrador and it's not too sporty (too many points on my license already).
Only thing that puts me off it is the fact I wont be able to fit my bike in the boot without removing a wheel and roofbars would look ugly and cause problems long term because they mount through the door openings.
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