Company car tax vs Private owned car???

bloke91

Hi All

I have changed job and currently have a Ford worth about 5k that I own outright, no outstanding finance on. My previous loan for this mid range Ford was£250 a month over 4 years.

My new role comes with two options which I keep thinking about, wondered if anyone who is or has been in same predicament may be able to offer their advice/views?

Option 1

Take the 5k a year car allowance which equates to about £250 a month after 40% tax. My new role involves an extra £150 a month in petrol costs, (12k a year additional miles) so this would cover the cost of the additional petrol.

Option 2

Go for company car option, which offers higher range cars such as Audi A3/A4S line models. This option includes a mandatory fuel card which covers all work and private fuel, this part of the company car package. With this I have calculated the cost to be about £270 a month over 4 years. This includes services, insurance, MOT, tyres and all Petrol.

Option 2 would mean a top of the range car for about £250 a month which I can't see me ever buying privately via a loan. Downside would be that, no equity in the car at end of the 4 years and I wouldn’t own the car.

Option 1 would cover my fuel costs and allow me to own my own car etc, option 2 would allow me to have a more top of the range car and include all fuel but not own the car etc.

Any advice/views would be welcomed.

Thanks in advance

mgdavid

my choice for the last 20-odd years has been company car every time, especially with fuel included. It should be totally hassle-free and worry-free as unforeseen maintenance and breakdowns are someone else's problem so you don't need a contingency fund. You can save this into an ISA instead, and use the savings towards your own car when the time comes. Meanwhile, use the car to maximum effect, go and visit those far-flung friends and relatives that you've been putting off because of the fuel cost, go away at weekends, go out in the evenings, and if your partner has a car leave it at home whenever possible. BTW does your car scheme allow partners or family to drive the car, some do.