Car or cash?

Fireflyaway

I'm job hunting and a few of the jobs I've applied for come with a company car. Its all new to me so apologies if a stupid question!
I am fine with using my own car. My car is old and paid off and I plan to keep it until it gives up. So long as petrol is covered I'm OK with not having a company car. I can't see any benefits but as I say I'm ignorant about this so there might be something I don't know of.
My question is would it be acceptable to decline a car and ask for slightly more pay instead? If so what would be a reasonable figure?

Guest101

Company may not want you turning up in a banger?
Your car may give up, will you be able to replace it quickly?

Fireflyaway

I have an emergency fund to replace it but at present its very reliable and not embarrassing! Doesn't make a noise,isn't rusty etc! I'm just wondering financially if it makes sense. Are you able to use a work car for personal use? I don't have room to park 2 cars. I think the cash would be better but as I say this is all new. My current tax and insurance isn't expensive. How much would it cost the company and could my idea actually be more attractive to them? How much would it cost them to up my pay versus give me a car? I know it depends on the car etc.

pjcox2005

Normally it's a case of a car or cash offer, so you may have options.


I'd be surprised if it makes sense to turn down the car if the employer won't offer cash instead, as you'd typically be able to use it for personal use so wouldn't have costs of replacing your current car when it breaks.


Certain employment contracts have an age of car, so if I take cash option then car can't be over 6 years old.

LilElvis

I would go with the car every time. You pay via an adjustment to your tax code so its evenly spread over the year. My husband currently has a Tiguan and he pays roughly £3,500 pa, but that's as a higher rate tax payer. Halve that if you're a lower rate payer. Obviously the amount payable will be dependent on the vehicle. The benefits: tax, servicing, insurance, mot, tyres all paid.

Fireflyaway

LilElvis wrote: »

I would go with the car every time. You pay via an adjustment to your tax code so its evenly spread over the year. My husband currently has a Tiguan and he pays roughly £3,500 pa, but that's as a higher rate tax payer. Halve that if you're a lower rate payer. Obviously the amount payable will be dependent on the vehicle. The benefits: tax, servicing, insurance, mot, tyres all paid.

So I could as a lower rate tax payer pay maybe £1500 for a car? My present car probably costs £400 a year in tax insurance and mot so it doesn't seem ( unless there are repairs needed) cost effective.

LilElvis

Fireflyaway wrote: »

So I could as a lower rate tax payer pay maybe £1500 for a car? My present car probably costs £400 a year in tax insurance and mot so it doesn't seem ( unless there are repairs needed) cost effective.

Its going to depend on the vehicle. The Tiguan costs around £29k. Are you likely to be assigned a car costing that much? Don't forget that your car is losing value every year you have it. My husband has paid circa £21,000 in company car tax in the last 6 years and in that time my Mercedes A Class has gone from £18k to a couple of thousand - plus all my insurance,servicing etc. He has had a far better vehicle for the same cost as mine. Look at some of the online calculators to find out how much it would cost for the type of car you're likely to get before you rule it out. If your job role involves even a reasonable amount of business mileage it becomes even more likely that a company car will be more cost effective.

Fireflyaway

My own car probably costs about £500 if that. I'm planning to drive it till it dies so not worried about depreciation. I'm also not worried about upgrading. So long as I get safely from a to b. Seems a company car might actually cost me rather than being a welcome benefit. What could I expect in cash if I chose not to take one? This is providing I get the job! I'm being very presumptuous!

LilElvis

Fireflyaway wrote: »

My own car probably costs about £500 if that. I'm planning to drive it till it dies so not worried about depreciation. I'm also not worried about upgrading. So long as I get safely from a to b. Seems a company car might actually cost me rather than being a welcome benefit. What could I expect in cash if I chose not to take one? This is providing I get the job! I'm being very presumptuous!

And a brand new Golf would cost around £730 in tax. End of. No worries if something needs fixing. No cost if you chip your windscreen or puncture a tyre. If your car is aging the company car could well end up costing less.

gingerdad

i'd take the car everytime you can get a 40,000 merc that costs you £50 a month if you're lucky.

every company i've worked for that has had a choice of car or money have had a pretty low age limit.

i currently have a £30,000 car that costs me £1500 a year - lower rate tax payer. you get to run a new car every 3 years and don't have anyother costs - fuel i claim back business use.

you have to remember that dependng on what you do your insurance may go up - if you need class 2 or 3 business use. and they may have limits on what car you run - number of doors, age etc..