dba

remember,if he opts out and is a higher rate tax payer he will lose 50% of the monthly cash amount (40% tax plus NI).So £600 gross doesn't go very far! Many opt outees will add the tax saving from their current car to the opt money and use all of it to fund a new car.As already stated,a low mileage user should find their tax on a 20k car to be as low as approx £150after next June (thats just an average for for average co2 emissions).
Soooooo,if he gets £600 gross,thats £300 net plus his tax saving so only £450 to play with.He should get a new WRX on an 8% PCP for around £400 a month plus balloon and deposit.That doesn't leave much for running costs!

But he gets the car he wants!

[Edited by dba - 12/10/2001 12:22:25 PM]

Timbo33

You all need to assess whether your car is a necessary tool for your job. If it is a requirement of your job that you use the car for business purposes you will be able to claim the business portion of your costs (i.e. lease payments, fuel, maintenance, insurance) against tax.

This is either by claiming a mileage allowance or (if the tax man is nice to you) simply by adding up your total costs and offsetting the business portion against tax.

E.G:

Lease payments 12 x £400 p.m. £4,800

Fuel, 20,000 miles at 20 mpg: £3,270

Maintenance / Tyres etc. £1,200

Insurance £ 600

TOTAL £9,870

Business use 12,000 miles p.a. = 60% = £5,922

Tax saving at 22% £1,302

Or about a set of tyres a year!! Even better if you're a high rate taxpayer. I only get about £300 per month but I reckon I'm still in pocket versus the company car because of the tax. I've gone from a k (minus) tax code of £1100 to a new code of £9,800 which means I'm paying tax on £10,900 less this year!

This latter route will depend on your employer as to how much they back you up and the tax man as to how nice he is. General rule - don't take the p155!! Claim what is reasonable.

You need to take advice about this; the local Revenue office will be very helpful and probably will send you out loads of leaflets
and stuff.

They also have a great website:

http://www.inlandrevenue.gov.uk/cars/using_own.htm

Happy tax saving!!!


[Edited by Timbo33 - 12/14/2001 3:21:08 PM]

petersen

A friend is making that great leap of faith to Scooby ownership and this means coming off the company car scheme and taking the allowance.

His company have given him an offer re how much per month which he is currently mulling over.

Does any one have any pointers as to the general going rate at the moment, i.e if you have recently taken a cash option or know someone who has??

Any input gladly welcome.

Stuart

boxst

Hello

The usual rate is between £400-£600pm.

Steve.

Steve Perriam

it is !

bugger wish someone would pay me that to opt out of the company lease scheme

LeighJ

Did the same thing a year or so ago, standard rate is 4-600 quid, depending on how good you are at selling it to your boss. I split my allowance between, car loan and insurance.

DT

I get £225pm but it's tax free so the gross equivalent is £375. Our co. offers an in house lease scheme for Ford & Vauxhall's and I could get lots of car with insurance and maintenance all in. However, I wanted a car of my coosing so spent loads more and got a Scoob. No regrets.

Hadn't factored any mods into the inital "can I afford it matrix" tho!!!!

davyboy

you have to remember, that in April 2002 you would get taxed about £100 - £150 tax as well. So with my Crap math,
£225 after tax towards a motor +
+£150 tax I would pay if I had a company car
=£375 per month (cash) towards running a scoob, not as much as some of you guys but hey!

MarkWRX

I opted out of my company scheme 4 months ago and get just under £500 pm. Once Ive paid tax on it, and saved upon company car tax i'm still over £500 nett better off.

I got rid of my nice diesel which did 40+/gal and got the scoob (which does about 20/gal), but dont regret it at all for one minute.

HamsterWheel

Instead of a £22.5k car I get £8900 pa. Guess I'm a better negotiator than some on here !

Dave P

DBA, probably not 50% just 40% if he's a higher rate tax payer he's almost certainly at the NI threshold.

As above on the rates, some firms go up as the grade gets higher.

Dave

john coffey

I am in exactly the same boat as your mate, I currently have a 306 as a co.car, the lease is up in Feb and I have a new 2002 WRX arriving from Holland around that same time.
I am getting £5,400pa deduct 32% for tax and NI = £306 per month + tax saving of £80 as I no longer have a co. car, so a tad under £400 per month.
I will be getting the car on HP over 4 years the payments equates to roughly £380 per month so my company will theoretically be paying for my new Subaru.
The maintenance and business class insurance will be down to me.
I can't bloody wait.

simonma

I opted out to get a MY01.

I get £425 a month plus 10p a mile for business miles.

I was running a V6 mondeo as a company car before.

Am I better off? No. Scoobs cost so much to run.

But am I happy? YES.

Is the car mine? YES

Can I take it on a track? YES

Can I stick on crappy gizmo's and make it look 'wide boyish'? YES

Oh and business use insurance shouldn't cost you anything. I'm with Tesco and it didn't.

Si

chiark

Simonma, class 1 business insurance may cost you a shedload more depending on your occupation!!!!! If you carry valuable, sensitive equipment (or people) you'll find that you can be loaded quite surprisingly...

1.6 Vauxhall Vectra, or 380 quid a month? Hmm, let me think...

Also, don't forget that the taxman pays you money for running your own car for business. Which is nice.

john coffey

I'm a mobile support engineer, my business class inurance is an extra £75 per year, or £7 per day on a as and when reqd basis if going for fully comp only.
I'm getting 12p per mile but somehow I think that these cars will cost more to run than that.
Anyone care to tell me roughly how many miles they get from a full tank on a MY01 when driving mainly motorway miles.
Cheers

Z75

As part of a recent job offer I have the following co car scheme:

1) £500 per month allowance
2) £415 per month towards a co leased car.
3) Some PCP plan which I don't understand.

Obviously I am going for 1 because cash is king.

simonma

John


Full tank of Optimax roughly £40

Mainly motorway milage. Odd bit of hammering. 260-280 miles.

With air con on knock 20 off.

Si

markcp

I currently recieve an allowance from my company of around £400 nett per month - I think it is so much better, simply because you can drive anything you want - if I stayed with my last company and took a company car I'd be driving an Escort diesel!!!

Something nobody has mentioned is that by taking an allowance you also don't pay tax on your fuel card, plus you are able to claim back/offset a portion of the interest on your loan/PCP if you have taken finance.

Hope this hepls,

Mark.

Scumbag

Opted out myself...+ did all the calculations 3 months ago.

If you do a high proportion of business mileage (mine is 95%), and the car costs a lot to run (It's a scooby - so yes it does), then you are probably better off with the Exact method of calculation rather than the x pence per mile (we lose out on this as scoobs have less than a 2 litre engine - although you may have noticed the negative effect the turbo(s) have on the fuel consumption !!)

I bought mine outright, and although I can only claim a max of £3000 pa as depreciation, I can carry any extra over year on year, or until the year that I sell.

For giving up the company car (and associated free insurance / servicing etc), you get.....monthly allowance (-tax @ 40% if thats what you pay - you will be over the NI max limit), the saving on the tax you would have been charged on the company car (www.smmt.co.uk gives some reasonable figures for emmissions calculations), and the amount of tax relief you can claim for using your own car for work)
Obviously the down side is paying for insurance (class A Business use is included anyway with the Tescos policy - but watch out if you havent got a NCB), servicing, repairs, and depreciation

Personally I'm saving £1000 pa (in my pocket) between running a 280 bhp B4 RSK compared to a V6 Mundane-o (All costs included)

The company car is dead (well, mine is, anyway)

jasey

Company car = dull
Scooby =

Life's too short to worry about bills !

Z75

jasey my thoughts exactly.

911Boy

Mine too....although a C4 is the beast you want

Reffro

Just a quick note , but I noticed that at www.4car.co.uk they have a calculator that works out how much better off you'd be if you take cash instead of a company car. Thought someone might like to give it a try, I didn't as I don't have a company car.

fazack

Reffro,

Tried that thing on 4car.com, it work out fairly close to the figures I had done in Excel. Am am taking a £500p.m. allowance as of February and I reckon it'll be financially very close to running the Subaru as a company car. However, I have no deposit and plan to finance the whole thing over 5 years. I believe that at the end of that period I'll have a car with a residual somewhere between £5-10K. So, not only do I get to drive my ideal car, but I get a hefty bonus every 5 years.