Lease cars through Salary Sacrifice & Tax Credits

Miss_J

Does anyone know how this affects Tax credit payments?

I have the opportunity of a lease car through work, brand new, all in (which would save overall on the money I pay out at the moment each month) All the documentation states that those receiving tax credits should consider the implications on tax credit payments before going for a lease car.

I don't get a lot of tax credits, about £200 per month but this does help with the monthly budget, does anyone know how badly this would be affected if I opted to go for a lease car?

mitchaa

Miss_J wrote: »

Does anyone know how this affects Tax credit payments?

I have the opportunity of a lease car through work, brand new, all in (which would save overall on the money I pay out at the moment each month) All the documentation states that those receiving tax credits should consider the implications on tax credit payments before going for a lease car.

I don't get a lot of tax credits, about £200 per month but this does help with the monthly budget, does anyone know how badly this would be affected if I opted to go for a lease car?

Your annual salary would still be the same so you would surely still declare the same.

Miss_J

I think the issue relates to a change in income tax in that on the salary sacrifice scheme reverts to the company car tax rate rather than the standard tax rate which is the element that affects tax credits I think, can't find anything to explain it further in the lease car documentation.