Company car and reasonable use

[Craig@Clarity]

Short answer is your company can purchase a car and provide it to you as the employee. Same for your wife. Account for the BIK at 1% (2% in 2022-23) and on your tax return. Pay back 4p per mile on any personal mileage used if the company pays for the electric or claim back 4p per mile if you pay for the electric.

[eek]

Why on earth would you buy an electric car? BIK tax is currently pretty much free on electric vehicles. Just lease the company car and enjoy the Tesla legally. Buying electric cars is pointless anyway - they will lose value quickly as the batteries are getting better all the time. I am currently leasing an electric car at roughly £250/month. It hits the pocket at roughly £125/month so pretty much 50% off. And doing that means that you will also have your company pay for insurance etc etc.

+1 - an electric company car (or one purchased through salary sacrifice) is just about the best tax advantage you can grab.

[cannon999]

Why on earth would you buy an electric car? BIK tax is currently pretty much free on electric vehicles. Just lease the company car and enjoy the Tesla legally. Buying electric cars is pointless anyway - they will lose value quickly as the batteries are getting better all the time. I am currently leasing an electric car at roughly £250/month. It hits the pocket at roughly £125/month so pretty much 50% off. And doing that means that you will also have your company pay for insurance etc etc.

[parallelmonogamist]

I'm not sure what you were expecting. The professional forums are for serious questions and should expect a serious answer. By complaining about a po-faced response that implies you were joking, in which case why did you not put this in General so we could all have a laugh and not get banned for it?

I thought I'd explained that it was a bit of both. This kind of "taking it to the nth degree" question is useful for gauging boundaries and acceptable use.
It wasn't a complaint about the po-faced answers. But anyway, I do appreciate the answers as always.

[eek]

Being blunt the question is just "at which point does tax avoidance step into fraud and tax evasion."

And when you look at it like that you can see why I didn't bother to respond earlier.

[ladymuck]

I'm not sure what you were expecting. The professional forums are for serious questions and should expect a serious answer. By complaining about a po-faced response that implies you were joking, in which case why did you not put this in General so we could all have a laugh and not get banned for it?

[parallelmonogamist]

I suppose everything is going to be taken literally and po-faced on here. But at least I have an idea of what I was looking for, which is around the spirit of the law and what constitutes limits when it comes to availing yourself of such benefits.

Thanks, I guess. :-)

[northernladuk]

Scenario 1: The company buys a Tesla for me, despite perhaps not really needing to drive anywhere for work at the moment. Any risk in this?

Apart from the obvious point in your statement?

Scenario 2: The company buys my wife one as well? She's doing the standard PSC admin work. Expect a knock on the door?

You are already taking the piss in bold but I thought you weren't wanting to take the piss with this idea.

Scenario 3: Company sells the Tesla at "We buy any car" quoted price, then buys another one soon after. Having a laugh yet?

There is a strong smell of piss round here.

Scenario 4: Company does the same every year. Will the director find his legs in irons?

Every year? You are taking the piss so yes.

This is purely hypothetical of course and I wouldn't dream of doing scenario 4, but it would be good to get a steer on possible difficulties with Hector.

As with all hypothetical piss taking ideas it's pretty pointless.

If you need a car and the accountant says yes then get one. The rules around them are pretty clear. If you want to just think of situations that you can bend/cheat/bypass the system then just don't bother. Millions of smarter people than you have tried it and non of them are recognised as working else it would be common knowledge.

(I do have an accountant, based in Brighton, but they're not very helpful.)

If you keep asking him stuff like this I'm hardly surprised.

Find another one and ask them.

[ladymuck]

Don't forget to look into the Margin Scheme for second hand car sales. if you're going to do time, you may as well filtch off every scheme out there.

[parallelmonogamist]

I'm familiar with the technical aspects of getting a company car, as a PSC.

What I'm unsure about is the possibility of HMRC taking a dim view of possibly taking the p1ss.

Scenario 1: The company buys a Tesla for me, despite perhaps not really needing to drive anywhere for work at the moment. Any risk in this?
Scenario 2: The company buys my wife one as well? She's doing the standard PSC admin work. Expect a knock on the door?
Scenario 3: Company sells the Tesla at "We buy any car" quoted price, then buys another one soon after. Having a laugh yet?
Scenario 4: Company does the same every year. Will the director find his legs in irons?

This is purely hypothetical of course and I wouldn't dream of doing scenario 4, but it would be good to get a steer on possible difficulties with Hector.

(I do have an accountant, based in Brighton, but they're not very helpful.)

thanks.