Company car taxed at source

Shufflebottom

Hi,
please help. I recently changed jobs and started working for a company that tax their company cars at source.  After looking at my monthly net pay I am hundreds of pounds down each month, even with a pay rise and a very eco-friendly plug-in hybrid car.  How can I calculate the taxed at source is the right amount???
thank you

calcotti

Shufflebottom said:

Hi,
please help. I recently changed jobs and started working for a company that tax their company cars at source.  After looking at my monthly net pay I am hundreds of pounds down each month, even with a pay rise and a very eco-friendly plug-in hybrid car.  How can I calculate the taxed at source is the right amount???
thank you

If you are provided with a company car it is a benefit in kind. Your tax code will be revised to reflect this so your tax free allowance goes down. As a result your take home pay goes down. It's not the company making the decision it's the way company cars are taxed.
https://www.gov.uk/tax-company-benefits
https://www.gov.uk/calculate-tax-on-company-cars
If you want more information you may be better posting on the Saving Tax forum as this isn't a Welfare Benefits issue. https://forums.moneysavingexpert.com/categories/cutting-tax

Shufflebottom

Hi Calcotti,

Thank you for the reply. But how do I know that the amount taxed at source is the correct amount, I have just done a tax calculator and it works out over £700.00 a month difference which with an eco car I find astonishing.

Is there a chart or any form of guidance that I can look at to check?

Thanks in advance.

Shuffleb

sheramber

Google 'tax on company cars"

Dazed_and_C0nfused

I suspect the op means their company car benefit is being "payrolled" so a tax code deduction and P11d wouldn't be the method used for this car.

But if they had a company car in their old job they will really only notice a significant change in tax code from 6 April 2020 as the current tax years tax code needs to still contain a deduction for the company car with the old employer.

The op would need to provide more details to understand what has happened any better.

calcotti

Dazed_and_C0nfused said:

I suspect the op means their company car benefit is being "payrolled" so a tax code deduction and P11d wouldn't be the method used for this car..

Had never heard of that before but is the tax liability the same either way?

Dazed_and_C0nfused

calcotti said:

Dazed_and_C0nfused said:

I suspect the op means their company car benefit is being "payrolled" so a tax code deduction and P11d wouldn't be the method used for this car..

Had never heard of that before but is the tax liability the same either way?

I think so yes.  The benefit is essentially just treated as extra pay and tax deducted accordingly with no need for a tax code deduction or P11d.

jazzert1000

Shufflebottom said:

Hi,
please help. I recently changed jobs and started working for a company that tax their company cars at source.  After looking at my monthly net pay I am hundreds of pounds down each month, even with a pay rise and a very eco-friendly plug-in hybrid car.  How can I calculate the taxed at source is the right amount???
thank you

Go to "comcar" put your car and wages in and they will do the rest.

Comms69

At £700 a month difference, why not just lease your own vehicle?