Company Car ?

See

ok so I have had a read - so seems at the top end thats 35%. What is that of ? If they pay £500 per month for my car I have to pay 35% of that as TAX ? Who pays those business mile rates I saw of 40p a mile ?

You might find this link useful, it allows the calculation of company car tax liability; .

It claims that you will be paying £2,312 in tax (higher tax bracket) for having a company Audi A4 Saloon 2.0 TDi S Line Multitronic in the

2005/6 tax year. Or £11,200 if you have a company Mercedes-Benz SL 55 AMG as there is a P11D maximum value of £80K. Which is handy, as your tax liability seems capped at £11,200, even for example with a Rolls-Royce Phantom...

Yes, when the car benefit tax rules were changed the last time there winners and losers.

The winners were such as the MD's wife who runs an expensive little sports car jobby on the firm with insignificant business use, changing it every year. The losers were such as service engineers (Like me!) and reps who did large amounts of business miles and didn't use the firms car at weekends because it was full of tools, samples etc.

You might reckon paying £2312 per year in tax for a new Audi A4 cheap at half the price but remember you'll be paying that in years hence when it's retail value is much depreciated, and the revenue want to reduce your allowances by a value more/less equal to what the car is worth, every single year!

Re: the 40p /mile that's just the biggest amount the revenue will countenance an employer paying for the business use of a private car without taking the view that the employee is making a profit out of it and taxing him. It's only for the first 10k miles then it drops to

25p/mile. IGWS the employee meets the whole cost of running the car, and the employer may not want to pay as much as that, very many don't.

Before the petrol prices went up it used to be possible to run a miser rate car (New Skoda Octavia or cheap banger, or somesuch) and make money out of the deal. Now it's not so clear.

HTH

DG

If they don't pay the full amount then you can claim tax relief on the difference.

Also if the employer insists you knock off home-work mileage when going on a business trip direct from home, you can claim tax relief on that mileage too.

The book price of the car (not the discount price paid).

The company car tax is designed to make you not want one.

The scale is based upon emissions. You are recommended to choose a car with low emissions

The 15-35% equates to a taxable equivilkent amount. You will pay 40% of that amount in tax.

Any company with any sense.

tim

No, it is 35% of the list price of the car when new.

The employer, if they don't give you a company car.

As another service engineer I'll second that. I have argued for a 2 tier tax rate for years ... essential and perk. Also, there should no tax on an essential car not used privately.

I gave the car up when I lost the 25% tax rebate for doing over 18000 miles a year .... thanks for the van Mr. Brown.

Chris

AFAIK there isnt but you'd have to prove it, for example if it was parked on company premises evenings and weekends.

"Tumbleweed" wrote

What if "the company" was run from "home"? ;-)

My accountant tells me that in a small company the Revenue simply will not accept that it is happening.

I had to buy the car from the firm effectively having to find about

23k out of my taxed income (So 35k ++ pre tax) and run it as a private car claiming the business mileage.

DG

Have you seen Mr Brown-Stuff's proposals for company vans?

"Employees provided with vans and some double-cab pick ups by their employers and who use their vehicles for private use, such as picking up their children from school, will see their tax bills increase dramatically from 2007

The move was announced in Budget 2004 Van owners that use their vehicles privately will be charged a flat rate of £3,000 from 2007 - a six fold increase on the current rate of £500".

Wassat? You don't use the van privately, even to go to the tip or to B&Q for some bulky materials once or twice a year?

What if the Revenue "Won't Accept it", there's a tax charge of £3k at stake. :(

It seems you will be able to take the van home overnight but if you drop the kids off at school on your way to work the charge will apply.

Nice. DG

Then you are SOL :-)

"Tumbleweed" wrote

SOL = ??

Shit Out of Luck :-)

"Tumbleweed" wrote

How could HMRC show that there *had* been private use, when there *hadn't* been? :-)

They have no reason to. The tax applies if it is *available* for private use.

They don't need to. Liability is based on *availability for* private use, even in complete absence of any actual private use.

"Ronald Raygun" wrote

Ouch! How can HMRC get away with that?

What next? Suppose a company offers cheap mortgages as a BIK to employees - but a particular employee doesn't actually take advantage of the scheme. It certainly was "available for" use, so should HMRC tax the perk as a BIK even though it wasn't actually used?

Heck - suppose a consultant is "available for" hire 40 hours a week, but only works 30 hours (say) - should HMRC tax him as though he worked all 40 hours?!

It doesn't seem "fair" [isn't that in the taxpayers charter? ;-) ] to tax someone on the *possibility* of something happening, if it actually

*doesn't* happen...