Company car-time to decide?

semi

My company is due for replacement soon,4 year old vauxhall zaferia and will be replaced by another zaferia(tourer) 1.6 ecoflex exclusive with sat nav ,list price of 27255.
In two minds whether to lease privately,buy or carry on with a company car,company car tax will cost me £80 per month for the 4 year lease,still not a bad deal,what do you think? I would get a car allowance of 380 a month from the company(taxed)

InsideInsurance

Are you sure your sums are right on the BIK? Numbers look low compared to the calculator I use

Assuming the extra income wouldnt push you into a higher tax band then you'd effectively get net ~£260 extra takehome plus the £80 BIK savings giving a total of ~£340 to pay for a car with.

A quick google does show that a private lease should be below that by a fair bit depending on what mileage you are doing. Of cause you also then get the higher fuel allowance for a private car too

getmore4less

£380 car allowance is £258.40 net of 20% tax and 12% NI

Kiran

I have always gone down the car allowance rule as I own the car, should I need to change jobs etc then I still have that car. Providing you get a reliable car you will normally be quids in this way. I've had a few cars which have been paid for multiple times over with a car allowance and then when I deicde to upgrade I still have the bonus of whatever I can sell the car for. You do avoid the unknowns with a company car but I think you definitely pay for the privalege even more so with a fuel card unless you can whack on a good deal of private miles.

Just my thoughts based on past experience but no financial background

InsideInsurance

getmore4less wrote: »

£380 car allowance is £258.40 net of 20% tax and 12% NI

Always forget NI isnt always 2%

rs65

InsideInsurance wrote: »

Of cause you also then get the higher fuel allowance for a private car too

Our company pays the same per mile to company car people as it does to car allowance people. But car allowance people can claim tax relief on their P87.

scaredofdebt

I wouldn't pay that much for a Zafira personally.

Take the money and make your own choice.

semi

The BIK numbers are right,got the details direct from the lease company who need to know by Friday so they can order the car for September,I also need a car with a large boot due to my equipment & spares I carry so a private lease works out quite expensive,already had a couple of quotes on Hyundai & kia estates,mileage varies as well currently do roughly 13-14k a year,the zaferia is a nice car mind with lots of standard equip,saying that I haven't owed my own car for over 23 years!! I've got used to having everything taken care of.

jimjames

Kiran wrote: »

I have always gone down the car allowance rule as I own the car, should I need to change jobs etc then I still have that car.

I've always done the opposite, taking the company car so that I'm not saddled with an expensive car to pay back if I leave the company. A friend took out a new car using a car allowance and lost their job about 6 months later. Stuck with the remaining 30 months of the lease to pay for on a car they wouldn't have chosen to buy with their own money.

£80 a month for a new car that is fully funded sounds like a no brainer to me. I guess the other question is whether you have to get a new car or can run a used one? At my current company there is no specification that the allowance has to be used for a brand new car.

Kiran

I always try to get a used car as the car allowance pays more than the car devalues each month. That way I can sell it and not be out of pocket. I would agree however if you are buying new that this is a riskier stragtery.

Blancster1

InsideInsurance wrote: »

Are you sure your sums are right on the BIK? Numbers look low compared to the calculator I use

Assuming the extra income wouldnt push you into a higher tax band then you'd effectively get net ~£260 extra takehome plus the £80 BIK savings giving a total of ~£340 to pay for a car with.

A quick google does show that a private lease should be below that by a fair bit depending on what mileage you are doing. Of cause you also then get the higher fuel allowance for a private car too

Did your google results include maintenance and the cost of insuring as well?