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Best Company Vehicle Options?

Hi all,

After a first year of very successful trading (Limited Company - distribution of specialist engineering equipment), it's time for my co-director and I to acquire a couple of vehicles for both business (visiting customers and sites) and personal use. One of these vehicles could well be one of the 2 or 4 seat 'open-back' type pick-up trucks as it would be very useful for the business. The other an ordinary car of around 15k in value.

Could anyone give me a rough idea as to the most cost-effective way (read cheapest and simplest to both business and personal!) to obtain these vehicles? Would it be best to contract hire, purchase outright or each of us purchase privately and charge the company a mileage rate to possibly cover the loan repayments and running costs?

Are there any typical solutions to our situation

(We've been getting by so far with a van between us - getting a vehicle each will also allow us to employ a driver)

All thoughts appreciated.....

Reply to
Bill D
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A lot depends on how many business miles you're talking about wether to go contract hire or PCP etc. Personally if things are going well then I'd recommend long term hiring. works out cheaper than a lot of contract hire rates and if you can commit to a decent term i.e. 6 - 12 months then you can get some great rates. if you want to mail me privately I'll give you the details of the company we use.

BR

Reply to
Jason Power

Got to start somewhere...

A lot depends on the amount of business mileage, and the amount of confidence you have in your future profitability.

The "Big Cab" type pickups are notoriously fuel hungry despite having diesel engines. Some, the biggest of them, are currently not subject to VAT and are treated as vans as far as company car benefits in kind are concerned. However, in his last budget the Chancellor gave notice of his intention to make a benefits in kind charge in future on company vans available for private use. If he does this the resale price of these vehicles will drop like a lead balloon. I think you can take it in a company like yours the IR will not accept a scenario with no private use.

One scenario would be to buy your pick up now (whilst there is no vat, which may not always be the case) and run it as a private vehicle and charge the company the IR mileage charge. Do your sums and watch out for big repair bills (On account of big vehicle/big engine) and a possible resale price fall.

Alternatively a sneaky way might be for the company to buy it now (etc) and then once the chancellor has done his dirty deed buy it from the firm at the (by then very low) market price, newly re-tyred and serviced with new clutch and brakes (and a full tank) .

They can't touch you for it :- The Ken Dodd school of transport management.

In my industry sales and service reps commonly buy Diesel Skoda Octavias which are cheap to buy and to run and built to VW standards. They are presentable enough if you need to transport customers. You need to be doing enough business miles to cover the costs (remembering you can't recover the VAT on fuel used in a privately run car).

Incentive credit is usually a good bet (simplification, complicated issue).

Your last sentence has cost implications of maybe £40k/annum. :-)

DG

Reply to
Derek

There is VAT on them. The difference is that business are allowed to claim it back, which they can't do on a car. If you buy it privately, then you can't reclaim it.

You can use the Inland Revenue's fuel only mileage rates as a basis for claiming the VAT back on fuel.

Reply to
Jonathan Bryce

"Bill D" wrote

ISTR 15k is the limit for running a classic car as a company vehicle, which would cover a reasonable E-type coupe...

Reply to
John Redman

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