Car allowance

storeys66

Evening all.

I'm currently looking at a job where the salary would be in the 40% tax bracket (over £44k per annum) and there is a car allowance of circa £4,500.

Never having had any employer contributions for a car before, I'm curious as to how much of that £4,500 I'd actually receive each month with which to buy and run a car.

Can any of you advise me of what the actual take-home figures would be please? I don't think a company car is available as an alternative option.

Thanks

Sam

Credit-Crunched

The calculations are as follows (ex NI)



Total income (assuming £44k is the income + Care Allowance of £4,500)

= £48,500

£0-£9,440 @ 0% = 0
£1806 - £32,010 @20% = £6,040
£48,500 - £32,010 = £16,490 @ 40% = £6,596

so

Net Pay (simply) = £48,500 -£6040 - £6596 = £35864

storeys66

Having used an online salary calculator, I worked out that the car allowance of £4,500 would only result in a monthly take-home increase of £217.50 (excluding any pension contribution and student loan repayments).

Surely it's not right that something listed as a separate benefit (ie. car allowance) should not simply be tacked on to your annual salary and taxed accordingly?

Are there any claw-back provisions with a car allowance, such as claiming back tax and petrol usage (eg. 45p per business mile for the first 10,000 covered then 25p per business mile from 10,001 onwards)?

I was under the impression that a car allowance of £4,500 wasn't bad, but buying and running a car for under £220 each month is pie in the sky thinking... Hmmm.

bloolagoon

What you can claim depends on your work. My employer only allows 45p per mile, my husbands only allows petrol receipts paid for.

He pays 40% plus NI on his car allowance, so his £8000 per year loses at least half.