2yrs+ in contract, options needed regarding cost of driving

[css_jay99]

Hi,

I am currently over two years in my contract, so aware that I cant claim things like mileage allowance ....

My driving costs are high so was wondering if I can do the following.

I was wondering If I could stil buy a car as a company car (say £1500 -3000k) and then use this for driving to work?

Since will be using for work only, would there be any attributable Benefit in Kind involved?, would it be based on list price of the car?......

cheers

css_jay99

[moorfield]

Hi,

I am currently over two years in my contract, so aware that I cant claim things like mileage allowance ....

My driving costs are high so was wondering if I can do the following.

I was wondering If I could stil buy a car as a company car (say £1500 -3000k) and then use this for driving to work?

Since will be using for work only, would there be any attributable Benefit in Kind involved?, would it be based on list price of the car?......

cheers

css_jay99

Yes it is a benefit, based on its list price (not necessarily the price the company pays for the car) multiplied by a percentage based on its fuel emissions rating. Edit: Assuming you will use the car privately also, which let's face it, you will.

[northernladuk]

Yes it is a benefit, based on its list price (not necessarily the price the company pays for the car) multiplied by a percentage based on its fuel emissions rating. Edit: Assuming you will use the car privately also, which let's face it, you will.

It is possible to buy an old hack and use it purely for work and it is tempting once you have one to use it instead of your family car so you have to be pretty black and white and only use for work. As said it is list price and emissions so get an old exec car with inadequate diesel engine and numbers might work out pretty well, particularly when you can't claim any expenses at all. Most definately one for your accountant though as it is a bit of minefield.

We have done company cars a number of times on here and everytime we never really go a definitive answer and in most cases it seems it wasn't worth doing. We haven't however had a question about buying a hack for work so intersting to see where this one goes.

[Steven@Parasol]

As others have said, if you are over the two year rule then driving to work would not qualify as a business journey thus a benefit would arise.

A car benefit is based on the co2 emission. A benefit arises if a car is "available" for private use. It doesn't have to be used, just "available!"

One answer maybe an electric car which does not carry a benefit.

Employees and directors who are provided for their private use with a company car propelled solely by electricity are set to pay 0% on company car tax for the next 5 years.

More info from HMRC here

HM Revenue & Customs: Company Car Tax: Electric Cars

[Moscow Mule]

Company motorbike?

[moorfield]

get an old exec car with inadequate diesel engine

On the contrary, don't! Stick to a petrol engine, diesel will add +3% to the emissions multiplier.

[css_jay99]

I just did a bit of google search, but still unclear.

HMRC website says
"... When a company car is made available for the private use of an employee a 'benefit in kind' value is calculated in relation to the car, and the fuel if that is also provided for private use. ...."

If I dont use the car for private use then does that not imply that there is no attributable BIK?.

other things I have found in the company car calculators are:-
Employee contribution costs : is this contribution to runing expenses?
private use amount : :?
was car available for whole of tax year : ?


With a 750miles weekly trip to work on my 28mpg car, I recorn I could save about £220 monthly with a 55mpg car

css_jay99

[Steven@Parasol]

I just did a bit of google search, but still unclear.

HMRC website says
"... When a company car is made available for the private use of an employee a 'benefit in kind' value is calculated in relation to the car, and the fuel if that is also provided for private use. ...."

If I dont use the car for private use then does that not imply that there is no attributable BIK?.

other things I have found in the company car calculators are:-
Employee contribution costs : is this contribution to runing expenses?
private use amount : :?
was car available for whole of tax year : ?


With a 750miles weekly trip to work on my 28mpg car, I recorn I could save about £220 monthly with a 55mpg car

css_jay99

You don't have to actually use the car for private use, it just has to be 'available' for private use for it to be considered a BIK. So if it was a pool car for example, that is housed by the company overnight and you give the keys back once you've used it, then there is no BIK.

If it is parked on your drive way when not in use and it is available for private use (wether you use it or not) then it is considered a BIK.

[css_jay99]

You don't have to actually use the car for private use, it just has to be 'available' for private use for it to be considered a BIK. So if it was a pool car for example, that is housed by the company overnight and you give the keys back once you've used it, then there is no BIK.

If it is parked on your drive way when not in use and it is available for private use (wether you use it or not) then it is considered a BIK.

But my Home address which is where car will be housed/packed overnight is also my registered company address ...

css_jay99

[Fred Bloggs]

I think the only real way that you'll convince HMRC that car is "not available for private use" is to not have one.

There are good tax breaks available on "QALECS" vehicles, look them up on HMRC website.