Is a company car enought to leave a job?

jtwalterson

This as been half answered through over posts but I am still lost. Forgive my spelling !!!

I am considering taking a new job as I am pretty unhappy in my currnet role. But I am looking at the money side of things. My current role is get 25k and I own my car for personal use no work use. My new role would be 21-23k (not confirmed yet) with a company car. Its a field role so the car is needed.

I want to know the tax implications of the company car. I am hoping the the car would make up of the reduction on salary but I am worried the car will increase my tax and make the move not worth it.

For reference the car is likely to be a Seat Leon.

Thanks for your help!

James

wgl2014

Go with the job you enjoy doing.

Is there likely to be any salary progression in the new job?

marlot

jtwalterson wrote: »

I want to know the tax implications of the company car. I am hoping the the car would make up of the reduction on salary but I am worried the car will increase my tax and make the move not worth it.

Ignore Supersonos. Some of here try to help people.


Yes, the company car will be taxed. It will have a taxable value which is based on it's list price, and you pay a percentage of that based on the car's emissions.



I found the values for a bunch of Seat Leons here: https://www.nextgreencar.com/company-car-tax/make-model/seat/leon/


So if you're allocated the first one on the list, it has a P11D value of £18,060. In year one, your tax is based on 25% of that. ie. as if you earned an extra £4515 a year.


As you pay tax at 20%, you pay extra tax of £903 a year to have the car.


This assumes you pay for your own fuel for personal use.


Someone will be along in a few moments to check my figures, I'm sure.

Vegastare

Partner went for company car and tax rise, balanced against the no insurance costs - servicing or tyres etc it softened the hike - plus you have no depreciation . One thing to mention is I believe that your no claims bonus does drop back and should you move away from company car some insurers will not look back at your previous no claims...maybe someone can clarify this

sheramber

If you keep your own car and have a company car then you will be worse off.

But , if you sell your own car and only have the company car then you will not have the expenses of running a car- no insurance, vehicle tax, servicing, repairs, tyres etc. So, you save that outlay.

unholyangel

If you're purely looking at the financial aspect....

How much does running your own car cost you per year?

I mean if you want to get really complicated, you could consider things like travel time, employee discount schemes or other benefits, increased mileage statistically increasing the chances you'll be in an accident, working pattern, overtime & rates etc. The grass can look greener on the other side until you see it up close!

What is it about your current role that you're unhappy with? Have you broached the subject with anyone at all? Sometimes employers are happy to make changes to keep a good employee

jtwalterson

Thanks for the advice. My current role as been rough for 8 months now. So a change it's needed.

So to check my understanding and that I'm not missing anything.

My current job is 25k. I pay normal tax etc. I pay for my own car for personal use which costs me approx 2-3k a year.

My new role would be 21k plus a car and bonus. I would likely pay approx a 1k more in tax for the car.

Is there any over costs I am missing?

DoaM

If the new job is nearer £23k then the included car will work out marginally better. If nearer £21k then it's marginally worse. £22k and it's a coin toss. Rough and ready calcs below ... I've used 0.3 as an amortised tax burden (income tax, NI, pension etc.)

£25k x 0.3 = -£7.5k = £17.5k take home - £3k car = £14.5k net
£23k x 0.3 = -£6.9k = £16.1k take home - £1k car = £15.1k net
£22k x 0.3 = -£6.6k = £15.4k take home - £1k car = £14.4k net
£21k x 0.3 = -£6.3k = £14.7k take home - £1k car = £13.7k net

marlot

jtwalterson wrote: »

Thanks for the advice. My current role as been rough for 8 months now. So a change it's needed.

So to check my understanding and that I'm not missing anything.

My current job is 25k. I pay normal tax etc. I pay for my own car for personal use which costs me approx 2-3k a year.

My new role would be 21k plus a car and bonus. I would likely pay approx a 1k more in tax for the car.

Is there any over costs I am missing?

Only that I based my calculations on the cheapest car in that list. Depending on the exact model you're given you might have to pay a little more.

I did a quick google, and here are the petrol models: https://comcar.co.uk/companycar/tax/select/?make=SEAT&model=Leon+5dr&fueltype=petrol The same site can give you the diesel ones too.


But ... you save on a bunch of existing costs: road tax, depreciation, repairs, insurance, breakdown policy, ...

AdrianC

jtwalterson wrote: »

I am considering taking a new job as I am pretty unhappy in my currnet role. But I am looking at the money side of things. My current role is get 25k and I own my car for personal use no work use. My new role would be 21-23k (not confirmed yet) with a company car. Its a field role so the car is needed.

I want to know the tax implications of the company car. I am hoping the the car would make up of the reduction on salary but I am worried the car will increase my tax and make the move not worth it.

For reference the car is likely to be a Seat Leon.

You need to know the list price and the CO2 for the precise car, to be able to calculate the exact cost - but you can plug typical figures into here...
https://www.gov.uk/calculate-tax-on-company-cars

I think you're looking at the wrong aspect here, though, tbh.

You're going from an office job to a roadwarrior job - that's going to be a VERY big difference, and it's really not one that suits everybody. And, on top of that, you're taking a 15% paycut, to about half-way between your current salary and full-time minimum-wage?

wymondham

Do the job that makes you happy, everything else is just noise...