Company car tax driving me batty....

thechippy

Hi all,

Could you help me with this please.

I'm trying to help a friend who has been offered a job and he needs to know exactly how much his take home pay would be.
I've tried to work it out for him, but keep getting confused with the company car element.

Details..

Salary 37,200
Car cost when new 21,000
Emissions of car 135
Company pays all fuel including private (although private fuel as such would not be much)
Job is office based, 55 miles each way (which would be classed as private I assume)

Many thanks for any help...:D

jimmo

Does HMRC's car and fuel benefit calculator help?
http://www.hmrc.gov.uk/calcs/cars.htm

thechippy

Thanks for the reply, I'll take a look.

thechippy

Hi,

Had a look and came up with the following

car benefit 4000
fuel benefit 3760

tax at 20% on both 1522

So, being a thikky - how do I use this figure to calculate the take home pay?

Does the 1522 come off your personal allowance, so I can just do personal allowance, less 1522, then take that final figure off salary and make the take home calculation?

BoGoF

thechippy wrote: »

Hi,

Had a look and came up with the following

car benefit 4000
fuel benefit 3760

tax at 20% on both 1522

So, being a thikky - how do I use this figure to calculate the take home pay?

Does the 1522 come off your personal allowance, so I can just do personal allowance, less 1522, then take that final figure off salary and make the take home calculation?

No take the £7760 of your personal allowance, then you are on negative allowances = a K code.

thechippy

Many thanks for your reply, but sorry I still don't understand.
I just want to know how to calculate the take home pay based on the previous figures given and that which came up for the car. Sorry....:o

BoGoF

Simplest way is divide the £1522 by 12 and deduct that from his monthly take home pay.

thechippy

BoGoF wrote: »

Simplest way is divide the £1522 by 12 and deduct that from his monthly take home pay.

Hi,

Thanks for that.

I used an online take home pay calculator based on 37000
and it gives a take home of 2293. Less the 1522/12 which is 126, so take home would be 2293-126 = 2167. Is that correct do you think?

http://www.thesalarycalculator.co.uk

Thats the calculator I used.

BoGoF

Use the calculator again with a tax code of K285, which is what his tax code will be - 7475 minus 7760 = minus 285. You may get a different answer as he is now flirting with the 40% tax band

thechippy

Thanks again.

Trouble now....I've used both calcs and one gives a take home of 2167 and the other (using the tax code) 2048 and I don't know which one is correct??

Sorry, this may seem trivial, but 2048 would put him on less than he is now, but 2167 would be enough to swing him to the new job.
That's why working this out is so important.

Thanks for your help so far....:beer:

BoGoF

It's a bit more complicated because we're partway through the tax year but assuming he had the car at the beginning of the tax year his tax would be:

Salary £37,200 + car/fuel benefit £7760 = £44,960.

minus personal allowance £7475 = £37485 of which

£35,000 @ 20% = £7000.00
£2485 @ 40% = £ 994.00

Total tax £7794.00 divided by 12 = £649.50 will be the new monthly tax. His NI should be the same so substitite the £649.50 for his old tax.

If he gets the car partway through the tax year he may not go above the 40% threshold. WHat date did you use to arrive at the car/fuel benefit figures you got?