Ok, I'm now eligible for a company car or a cash alternative.

To get a car that I want I will probably have to add a personal contribution each month.

If I add £200 (deducted from my salary) how does this work?

E.g. If Salary is £5k/month basic do I get taxed on £5k then deduct £200 / month from my take home?

Does the £200 / month come off my basic before tax is applied?

How much does this £200 contribution actually cost me?

Additionally, I know that I am also liable for tax on the car, from the calculators the cost of a 335d Beemer is similar to a 335 petrol - am I doing this right? thought the petrol would be more?.

Cheers

 

I used the calculator on this website Company Car Driver. It allows you to enter your contributions and see how it affects your tax.

Steve

 

Thanks Steve

 

Generally any personal contribution from you towards the cost will be deducted from your gross salary before tax, so effectively the cost to you is the amount less the tax on that amount.

So your £200 contribution will only cost you (assuming 40% tax) £120.

HTH

 

why not take the cash and get your own car. i get 250 per month car allowance and use that toward smy own scooby. i also get a fuel card

 

Thanks Guys,

Stephen - may yet do that (or in reality just pocket the money as I own a newish car outright). Just want to review all options.

 

Not sure about monthly contributions but lump sum contributions only count up to £5k for tax relief. ie up to £5k gets deducted from the taxable cost of the car.

 

Just to clarify.

I will be making a monthly contribution to my co. car. This contribution is taken off the value of the car so I don't pay benefit in kind on it. Does it also come off my salary before income tax is paid on it in the same way pension contributions are made?

I can see me having to get an accountant!

Steve