Biggins

I am toying with the idea of providing myself with a Company car and am having difficulty working out the benefit in kind on the vehicle & fuel.
Don't want to bother my accountant at this stage if it's going to be a financial no no.

Can anyone who has a Company vehicle help clarify the situation for me?

The car would be for myself only and I am the sole director of a Ltd Company.

I currenltly have no other benefits in kind and my gross salary is £35k (lower rate tax payer)

Business mileage in 1 year would amount to no more than 2,500

Private mileage in 1 year would amount to no more than 14,000

I would like the Company to pay for both private and business fuel.

The cars i'm toying with are Porsche 911 C4S or C2 and BMW M3 SMG (e46).

The reason i'm looking into this is that we are moving home at the moment and need every penny. I currenly run a privately owned and paid for Seat Leon Cupra R which I could sell for 14k-15k. At the moment I reimburse any business miles travelled each month at the government stipulated pence rate per mile.

Obviously it's a case of weighing up the personnal tax increase against the benefit of (a) the car and (b) the free fuel/insurance/servicing/consumables etc.

Anyone care to help?

Thanks.

Redkop

http://bbs.scoobynet.co.uk/showthread.php?t=349909

http://bbs.scoobynet.co.uk/showthrea...31#post3632331

ProperCharlie

that's going to cost you. roughly you will have 35% of the list price of one of those cars added to your taxable pay. every year.

(that's why I got rid of my "Company" STi)

Tiggs

so you are a basic rate tax payer about to move house and want to run an expensive sports car????

ProperCharlie

As Tiggs is pointing out in his cryptic style, you are far far better off keeping your current car and claiming the allowed business milage. it's tax free, after all.

as an aside, maybe your business milage would somehow increase to somewhere near 10k per annum (the most allowable at £0.40)? just an idea. as for servicing, well that rather depends on what kind of business you run...

Edcase

Other option is to buy the car yourself and give yourself a pay rise to cover the cost of repayments.

OllyK

A car allowance in otherwords - just remember that it is effective increase in gross and will be taxed accordingly. So if the payments are £100 pcm, you will need to increase your pay by a good bit more to cover it, plus such an arrangement is usually scaled to cover the extra insurance for business use, and a contribution towards service and so on, with you still able to claim the ppm for business mileage.

I have done this with the last 2 companies I have worked for rather than mess about with a company car. £400+ pcm is not considered excessive for a company car allowance, and you are a director and need to have a suitably prestigious image, no reason it can't be quite a bit more

Leslie

Maybe you should get a company house!

Les