Got Company Car, Having Second Thoughts on BIK and Thinking about Alternatives. HELP!

ittunni

Hello all,
I was recently given the option to choose a company car (first time) or an allowance following an internal promotion. Initially I opted for the allowance (~£5000/year) with the intention to use my 7 year old Accord as I wasn't travelling much (in fact ~8000 miles a year).
But later I was told that the car was too old to be approved for business use. So I either had to get a newer car or to go for a company car. I then decided to sell my car and opt for a BMW 320d ED (which had a lower BIK of £1100 per year) which I have had for a few months now.
In hindsight, it was probably a foolish decision and I think I am losing quite a lot of money in allowance. I would have received around £250 after Tax as the monthly allowance. Instead, I am having to pay around £90 in benefit tax for this car.

If I were to return the company car now and get a private one, what would be my options? I do not want to buy an used car outright with my savings (although it might be the best thing to do). Best would be to direct the allowance to the monthly payments for a lease, but I can't decide.

How do people normally manage this situation? Any advice would be helpful.
Many thanks.

marlot

Every employer I've worked for has a rule that once you have opted for the car, you have to stick with it until the car is 3 or 4 years old (unless you hit a mileage limit sooner).

ittunni

marlot wrote: »

Every employer I've worked for has a rule that once you have opted for the car, you have to stick with it until the car is 3 or 4 years old (unless you hit a mileage limit sooner).

I do remember signing a special clause for a minimum 3 or 4 years when I first opted for the allowance. Certainly didn't notice anything similar when selecting the car. I could check that with our fleet manager, but I do want to understand the options before I go to them.

spiro

ittunni wrote: »

I do remember signing a special clause for a minimum 3 or 4 years when I first opted for the allowance. Certainly didn't notice anything similar when selecting the car. I could check that with our fleet manager, but I do want to understand the options before I go to them.

The 3 or 4 years is because that is how long the company you have worked for has now leased the car for. Unless someone else is due a new car and is prepared to take on your I think you are stuck with it for the duration.

Hintza

The car will be on lease and unless someone else is willing to take it on I suspect you will be stuffed with it.

Edit:- Didn't notice Spiro's post.

laidbackgjr

So basically you would have £340 a month to tax, insure, service, and purchase a suitable car. I think you'd struggle to get a similar car to the BMW 320d for this amount a month.

ittunni

spiro wrote: »

The 3 or 4 years is because that is how long the company you have worked for has now leased the car for. Unless someone else is due a new car and is prepared to take on your I think you are stuck with it for the duration.

Hintza wrote: »

The car will be on lease and unless someone else is willing to take it on I suspect you will be stuffed with it.

Edit:- Didn't notice Spiro's post.

Thanks spiro & Hintza. I understand your points, in fact this car wasn't specifically leased for me, but in my previous company which was relatively small they always leased cars for individual employees. Our company has a fleet operation and they maintain a list of cars which are ready for allocation to employees. So when I contacted them about the car, they gave me a list and asked me to pick one that I liked. Looks like the minimum term might be dependant on the company policy, so I will contact the fleet manager and clarify.

ittunni

laidbackgjr wrote: »

So basically you would have £340 a month to tax, insure, service, and purchase a suitable car. I think you'd struggle to get a similar car to the BMW 320d for this amount a month.

True, that is if I get a BMW. In fact I was thinking about a less expensive one. Would it be wiser to go on a lease contract or will I be better of with a hire purchase?

ian103

I'd stick with the company car, £340 a month is a bargin for a BMW especially when you think there are no bills for tyres, servicing, repairs, insurance, road tax etc.