Company Car advice please...

joeyvicks

hello,

I'm currently in the process of deciding whether to take a company car or the allowance.
My allowance options are;
1 - £350/month + 11ppm
2 - £75/month + 40ppm / 25ppm

Am i right in thinking that if i choose option 1, i could still claim back the difference between the 11ppm and 40ppm from HMRC?

fengirl_2

Yes, you could.

TM1976

You can claim, but not the difference, just the tax on it - this is at the highest rate of tax you pay first so likely to be either 40% or 20% of 29ppm.

joeyvicks

is this because i am already recieving an allowance per mile?

fengirl_2

Yes, if you are only receiving 11p pm and being taxed on the car allowance, you can claim tax relief on the differnece between 11p and 40p. If you are already paid 40p pm, then there is nothing to claim.

PharmaRep

How many miles per year do you do?

joeyvicks

difficult to say as i'm a Quantity Surveyor so as and when jobs are ongoing i will visit the sites (depending on size of the scheme) 1/2 times a week.
At a rough guess going on current i do 300 private and 200 business a week.

joeyvicks

sorry that should be 300 business a week also

Bean_Counter

joeyvicks wrote: »

difficult to say as i'm a Quantity Surveyor so as and when jobs are ongoing i will visit the sites (depending on size of the scheme) 1/2 times a week.
At a rough guess going on current i do 300 private and 200 business a week.

Are you a site based QS or office based? Do the sites tend to last less than 24 months in duration?

If you are site based and the contracts last less than 24 months then travel from home to site is regarded as business travel. See this link.

joeyvicks

Bean_Counter wrote: »

Are you a site based QS or office based? Do the sites tend to last less than 24 months in duration?

If you are site based and the contracts last less than 24 months then travel from home to site is regarded as business travel. See this link.

'Normally' site based but currently doing a lot of work from the office as the jobs that i'm currently looking after a £250k and below and dont warrant much site based attention.
In the past i have been permanently site based, but this was for my former company that went bust. Think its going to have to be the company car with card option unfortunately

inmypocketnottheirs

Buy yourself one of the last shape Mondeo diesels for a couple of grand, take the £75 month and 40/25p per mile would be my advice!

Bear in mind that in order to break even on 11p a mile at current prices you will need a vehicle that does at over 40 mpg. If fuel prices rise further, as predicted, then you could likely end up subsidising your employer for driving around in a company car.

Also factor in the £350 or £75 will be taxed at your usual rate, where as the 40/25p isn't.

Using your own car is a lucrative way of actually making some money out of your business mileage.

I do it.