Reply to: what electric car you driving?

[WTFH]

You're confusing the term business use. It has never been declared as wholy and exclusive use by the business, like a pool car. The director is already paying BIK for personal use of the car as part of their remuneration. HMRC accepts that position, which is why only 50% of VAT is recoverable on vehicle lease purchases with personal use. Paying a director is a perfectly normal thing to do for a business. A director drawing renumeration from multiple sources is also perfectly normal.

Something like school fees could be paid as part of the remuneration but there is no preferential BIK rate for that, and the new VAT would not be recoverable as it fails the whole and exclusive test.

That's an interesting one - the director is on PAYE for one job, no getting out of actually contributing some tax to society there, and then going to be claiming remuneration (or renumeration) for their directorship - there'll be a nice tax burden on that one.
Also, you talk about BIK for personal use, but some of the actual use is going to be work related for a different company. I wonder how expenses and mileage work if the car is owned and paid for by one company, but the driver is claiming expense from another. Sounds like double dipping.

[sadkingbilly]

You're confusing the term business use. It has never been declared as wholy and exclusive use by the business, like a pool car. The director is already paying BIK for personal use of the car as part of their remuneration. HMRC accepts that position, which is why only 50% of VAT is recoverable on vehicle lease purchases with personal use. Paying a director is a perfectly normal thing to do for a business. A director drawing renumeration from multiple sources is also perfectly normal.

Something like school fees could be paid as part of the remuneration but there is no preferential BIK rate for that, and the new VAT would not be recoverable as it fails the whole and exclusive test.

and you're 100% certain of this in all cases?
like I said, you're golden.
<until you get an audit>

[BlueSharp]

Except the director is drawing a salary PAYE from another business. Therefore 100% NOT “business” use.

You're confusing the term business use. It has never been declared as wholy and exclusive use by the business, like a pool car. The director is already paying BIK for personal use of the car as part of their remuneration. HMRC accepts that position, which is why only 50% of VAT is recoverable on vehicle lease purchases with personal use. Paying a director is a perfectly normal thing to do for a business. A director drawing renumeration from multiple sources is also perfectly normal.

Something like school fees could be paid as part of the remuneration but there is no preferential BIK rate for that, and the new VAT would not be recoverable as it fails the whole and exclusive test.

[WTFH]

Being reported as BIK means it's part of the director's remuneration, so 100% business use

Except the director is drawing a salary PAYE from another business. Therefore 100% NOT “business” use.

[BlueSharp]

so long as HMRC see it that way, you're golden

Being reported as BIK means it's part of the director's remuneration, so 100% business use

[sadkingbilly]

As long as BIK is paid, it would just be seen as remuneration for the director. The company will need a director to try to secure future work and keep things ticking over.

so long as HMRC see it that way, you're golden

[BlueSharp]

If your car is leased through your company and you end up going through an umbrella, then you need to keep your company afloat to pay the lease. There may also be questions raised about having a car through a company, where the company's sole purpose is to pay for the car.
If your car is owned by your company, then you may need to buy it off the company at fair market value and have it as a personal car. Again, there may be questions asked about a company owning an asset which is being used 100% for purposed outside the company.

As long as BIK is paid, it would just be seen as remuneration for the director. The company will need a director to try to secure future work and keep things ticking over.

[WTFH]

Do you mean if you get a car through your Ltd company whilst outside IR35 but then later get a gig inside, you'd have to get rid of your car (or presumably pay a higher level of BIK tax)?

If your car is leased through your company and you end up going through an umbrella, then you need to keep your company afloat to pay the lease. There may also be questions raised about having a car through a company, where the company's sole purpose is to pay for the car.
If your car is owned by your company, then you may need to buy it off the company at fair market value and have it as a personal car. Again, there may be questions asked about a company owning an asset which is being used 100% for purposed outside the company.

[BlueSharp]

Do you mean if you get a car through your Ltd company whilst outside IR35 but then later get a gig inside, you'd have to get rid of your car (or presumably pay a higher level of BIK tax)?

Personally, there are a few options to deal with the situation NLuk describes

* Pay off the HP loan from company reserves and then personally buy it. Corp tax is chargeable on the asset disposal sale price. As long as it was the Market rate (i.e parkers car guide range), then no BIK would be due on the sale.
* Sell the car and pay off the HP loan, and close the company
* Take the inside gig, keep the company open, but still pay BIK via self-assessment

[edison]

Unfortunately there is a very high chance of you having to go inside on future gigs nowadays. I used to think it would never happen to me but it has so be aware that your circumstances are likely to change in the term you (the company) has the car so factor disposing of it etc in to your calculations.

Do you mean if you get a car through your Ltd company whilst outside IR35 but then later get a gig inside, you'd have to get rid of your car (or presumably pay a higher level of BIK tax)?

[sadkingbilly]

ok, i give in.
which one of you is Ernie???

[woody1]

We have a winner. I went for the Y AWD in the end. As quick as the Macan, bigger than the Q6 and pretty much all the optional extras as standard for £30k less and interest-free.

Brits losing their minds over Musk because of the Democrat smear campaign has been the icing on the cake, to be honest.

I'll put my hands up, you got me, until I remembered what day it was. Good one.

[DoctorStrangelove]

Looking on the bright side, The Reichleiter's product is a bit less likely to get 7.62x39 holes in it than in SepticLand.

[BlueSharp]

Tesla Y Long Range, leased - love it to be fair. Cheap leases to be had now before the model change.

We have a winner. I went for the Y AWD in the end. As quick as the Macan, bigger than the Q6 and pretty much all the optional extras as standard for £30k less and interest-free.

Brits losing their minds over Musk because of the Democrat smear campaign has been the icing on the cake, to be honest.

[fatJock]

Tesla Y Long Range, leased - love it to be fair. Cheap leases to be had now before the model change.