Company car tax & fuel benefit

teapackets

Hello,

My OH has started a new job and has been offered a company car and fuel.

We have done the calculations on HMRC website and have worked out that the car will cost us approx £70 per month and the fuel another £70 per month. (£70 x 2)x12/52= £32 pw)

As the job is a 60 mile trip each day, we calculate that even if he used his own car, paying the £32 pw would be quite a bit less than the £45 it costs him to fuel his own car to get to and from work.

Claiming private mileage doesn't come into the equation as he doesn't leave the factory!

Are we missing something major here :question: ... or are we being offered a good thing?

As we currently can only afford one car, this offer (on face value) would seem to give us a second vehicle for free (in effect!).

Thank you

angelbob

Sorry i don't know much about company cars but just wondering who pays the tax, mot (if needed yet) and insurance?

teapackets

Hi angelbob, the company pays for everything.

woohoo_postingid

Are you sure the fuel from your home to the place of work is covered. Normally, in my experience although I could be wrong, travel between your home and your normal place of work is classed as private mileage.

System

Home to work is classed as commuting which is private mileage. he will probably be expected to pay this back each month.

teapackets

Hi !!!!!!, I understood that is covered by the private fuel benefit?

Spendless

Hi, My DH has a company car and we don't pay for fuel (either business or pleasure) in the UK. He does pay tax on both these benefits. DH has a K tax code as his benefits in kind are more than his personal allowance.

When we were eligible for tax credits, I had to add on the value of the benefits in kind from form p11d which you get each June onto his income. The value of car plus fuel benefit plus family BUPA came to over £10k added onto his salary. If you have kids and are eligible for tax credits you may want to take this into account. It will also be taken into account next year when Child benefit becomes means tested for HR payers.

Is this going to be the family car too? Ours is. The advantages are not paying for insurance, MOT, Road tax and repairs as well as the 'free' fuel

teapackets

Thanks Spendless, yes, the plan is that we keep our current car (putting minimum fuel in it to get me to work and back when needed, instead of walking as I do now) and use the company car and fuel for all our running around in evenings and at weekend - and still in theory gaining a little as total tax we will pay on it should still be less than the fuel we would have to put in our own car to commute :¬)

Spendless

You have taken into account you will pay tax for having the car as well as for the fuel?

teapackets

Yes, we calculated £70 tax for car and £70 for fuel. (give or take a couple of pounds). The £140 is still less than commuting fuel in our own vehicle.