Company Car Tax

Ellsbells_3

My company car is 5 years old and has 155,ooo miles on the clock. It has little life in it and I need to get a new one. I understand that I am taxed on the retail value of the car i.e. I am currently being taxed as if my car was worth £19K which was the list price for it when it was new. Does anyone out there have any tips of how to get the best deal, for the car and from the tax man?

nearlyrich

Get the lowest cost most fuel efficient car with the lowest emmisions that you can comfortably use to do your job. It is a bit annoying that they keep using the list price of the car when new as one of the multipliers when most cars decrease significantly in value each year, for example my car when new in July 2005 was £18076 on the road, the same model is now £16770 but my P11 D value will remain at £18076 until I change my car.

Hoddie_2

It is a bit annoying that they keep using the list price of the car when new as one of the multipliers

The reason they use the list price at date of registration is because you're paying tax on what it would have cost you had you bought the car yourself. Had you done so, you wouldn't have received a discount 12 months later just because the model had reduced in price.

jstallan

My company car is up for renewal come end of March and I'm 90% certain that I will take the cash alternative this time.. If it's within you range, think about a Hybrid car - I think it's the best option in relation to Company car tax. check the Inland Revenue site for tax bands, it normally projects them for the next few years so you can see what costs to expect.

2006 saw the removal of the 3% waiver for Euro 4 Diesel emisions - !!!!!!!

Ellsbells_3

Hoddie wrote:

The reason they use the list price at date of registration is because you're paying tax on what it would have cost you had you bought the car yourself. Had you done so, you wouldn't have received a discount 12 months later just because the model had reduced in price.

Presumably I wouldn't have had to buy the car every twelve months either!

Hoddie_2

Perhaps not, but you're paying tax on somewhere between 15% and 30% of the list price every year. So the full value of the car may not be reached for five or six years, and even then you're only pay tax on the full value - either 22% or 40%.

I'd willingly pay somewhere in the region of 5% to 10% of a car's value if someone else paid for it, taxed it, serviced it and insured it for me!