Company car benefit

DoaM

Grumpy_chap said:

As others have demonstrated the car allowance offered looks good.
Regarding the fuel, though, you need to look again.  Others have treated the fuel card as still applying in the same way as it does for a company car.  That is not the case when you have your own car plus a fuel card - which really is the best of both worlds.
The fuel card for your own car will mean you pay BIK on the actual amount of money spent at the fuel pump.  You can then claim back as a tax allowance for business mileage at 45p per mile for the first 10k miles then 25p per mile after that.

That's not how it works in my company. We use fuel cards, the whole amount is paid for by the company ... we reimburse the company (monthly*) for private miles at the lower HMRC rate. Depending on the cost of fuel this works out at break even or a small profit for the driver.

* We complete online forms at The Miles Consultancy wherein we advise the odometer reading, and declare business miles. The balance is private miles which gets deducted from our salaries at the lower HMRC rate ... 11p per mile at the moment for my own vehicle.

Jack_Cork

DoaM said:

Jack_Cork said:

plus I think as its your own car you can claim a higher amount per mile for the fuel

Unfortunately that's not correct ... it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

I wasnt sure about this, I've only had company cars

Car_54

DoaM said:

Jack_Cork said:

plus I think as its your own car you can claim a higher amount per mile for the fuel

Unfortunately that's not correct ... it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

Are you sure about that? Any source?

Will HMRC even know about the car allowance? As it's a cash payment, not a benefit in kind, it's not declared separately.

rs65

DoaM said:

 it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

That's not true.  
I get more than the lower HMRC rate and claim tax back on the difference up to 45p 

DoaM

Jack_Cork said:

DoaM said:

Jack_Cork said:

plus I think as its your own car you can claim a higher amount per mile for the fuel

Unfortunately that's not correct ... it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

I wasnt sure about this, I've only had company cars

rs65 said:

DoaM said:

 it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

That's not true.  
I get more than the lower HMRC rate and claim tax back on the difference up to 45p 

I currently have a company car, the BIK is added to my salary and I get taxed on that at my marginal rate. I also have a fuel card which the company pays and private miles are charged at the lower HMRC rate (11p per mile). I have been told by my company that when the current lease expires then I will be moved over to an allowance (also ~£550 per month like in the OP). When this was announced we asked about fuel and mileage rates ... we were informed that the fuel disbursements will remain unchanged. As my employer is a global corporation who (so they state) follows all laws in all countries in which they operate, I can only assume that they've had this cleared by their legal team in relation to HMRC and taxation.

Jack_Cork

DoaM said:

Jack_Cork said:

DoaM said:

Jack_Cork said:

plus I think as its your own car you can claim a higher amount per mile for the fuel

Unfortunately that's not correct ... it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

I wasnt sure about this, I've only had company cars

rs65 said:

DoaM said:

 it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

That's not true.  
I get more than the lower HMRC rate and claim tax back on the difference up to 45p 

I currently have a company car, the BIK is added to my salary and I get taxed on that at my marginal rate. I also have a fuel card which the company pays and private miles are charged at the lower HMRC rate (11p per mile). I have been told by my company that when the current lease expires then I will be moved over to an allowance (also ~£550 per month like in the OP). When this was announced we asked about fuel and mileage rates ... we were informed that the fuel disbursements will remain unchanged. As my employer is a global corporation who (so they state) follows all laws in all countries in which they operate, I can only assume that they've had this cleared by their legal team in relation to HMRC and taxation.

As I said I've only ever had a company car so dont know all the ins & outs, however I saw this article, 
https://www.mileiq.com/en-gb/blog/car-allowance-mileage-allowance/#:~:text=A%20mileage%20allowance%20covers%20the,you%20use%20a%20company%20car.

It says mileage allowance covers the costs of fuel and wear and tear for business journeys.

You can claim a mileage allowance if you use your personal vehicle for work. This includes a vehicle you’ve bought using a car allowance. On the other hand, you cannot claim a mileage allowance if you use a company car.

Not sure how accurate it is, but its how I thought it worked

rs65

DoaM said:

I currently have a company car, the BIK is added to my salary and I get taxed on that at my marginal rate. I also have a fuel card which the company pays and private miles are charged at the lower HMRC rate (11p per mile). I have been told by my company that when the current lease expires then I will be moved over to an allowance (also ~£550 per month like in the OP). When this was announced we asked about fuel and mileage rates ... we were informed that the fuel disbursements will remain unchanged. As my employer is a global corporation who (so they state) follows all laws in all countries in which they operate, I can only assume that they've had this cleared by their legal team in relation to HMRC and taxation.

None of that relates to your statement about it not truly being a private car.  If you buy a car (using allowance or not) it is your private car.  A company can choose what they pay you - it may be the HMRC rates or it may allow you to claim tax relief or you may be taxed on it - all depending in what they pay you per mile

Rich6859

Thanks everyone. I just need to decide now if it’s best to carry on with a fuel card  and have the bik of £8000 for fuel which includes all mileage , so that also means not having to keep a running log of how many miles are private / work; or not 

Grumpy_chap

DoaM said:

Jack_Cork said:

plus I think as its your own car you can claim a higher amount per mile for the fuel

Unfortunately that's not correct ... it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

Jack is correct
DoaM is incorrect.
Once you take the car allowance, it is subject to tax and NI just as though you earned a higher salary.  If you do not take the fuel card, then mileage can be claimed against tax allowance at the 45p and 25p rates (not AMAP).

Scrapit

Grumpy_chap said:

DoaM said:

Jack_Cork said:

plus I think as its your own car you can claim a higher amount per mile for the fuel

Unfortunately that's not correct ... it's not truly a private vehicle as it is partly funded by the company in the form of an allowance. Therefore your business mileage can only be claimed at the lower HMRC rates.

Jack is correct
DoaM is incorrect.
Once you take the car allowance, it is subject to tax and NI just as though you earned a higher salary.  If you do not take the fuel card, then mileage can be claimed against tax allowance at the 45p and 25p rates (not AMAP).

Christ, don't say that, doam will be on telling you how big his employers are as a company and stuff, like it matters...