Company Car Tax still being collected after lease ended

benkbenkbenk

Hi,

My company car tax was still collected for three months after the lease ended last August. This was because Arval were struggling with the impact of COVID at the time, and didn't manage to collect my car until October. I was moving to a company car allowance, and tried to arrange with Arval to collect the car on the end of the lease, but they couldn't confirm a date for collection.

I had to chase them and chase them to finally get a date confirmed. I had gone out and purchased myself a car to be ready for the date the lease ended, as I had no idea when Arval would collect, and didn't use the company car during the three months it was sat outside my house waiting to be collected.

However HMRC are saying that because the car was available for use I am still to be taxed. Surely this isn't right?

Any advice would be greatly appreciated.

AdrianC

You had the car available to use, but chose not to. Yes, you are due to pay the tax on it.

I presume you've spoken to your employer's HR about this, as well as HMRC... They're the ones who notified HMRC as to when the car was available to you.

benkbenkbenk

I don't see how that holds up. I had no choice about having the car available to use, Arval just failed to collect it on time. I had no idea when it was going to be collected to so had to arrange another means of transport. The lease had ended, so I wasn't even sure if i was allowed to drive it. If Arval still hadn't collected it a year later would i still be paying company car tax even now?

Edit: - My company informed HMRC that it was not available for use on the lease expiry date. However I am now completing a self assessment, and HMRC are showing me as owing additional tax for last year, which I have worked out is due to this disrepency on my P11D, which now shows the car as being available until October.

lemondrops69

If the lease had finished then technically the car wasnt available to you as the lease wouldnt have been paid for those months, it wasnt your fault they hadnt collected it. 

You can also notify the HMRC on line about car changes yourself, never leave it up to your company to do this as they have 6 months to report changes, and I have seen some colleagues having to pay tax on two cars as their company hadnt updated HMRC. If it was me I'd have gone on the HMRC website the day the lease finished and reported I no longer had access to the car, which legally you didnt 

BOWFER

lemondrops69 said:

You can also notify the HMRC on line about car changes yourself, never leave it up to your company to do this as they have 6 months to report changes, and I have seen some colleagues having to pay tax on two cars as their company hadnt updated HMRC. If it was me I'd have gone on the HMRC website the day the lease finished and reported I no longer had access to the car, which legally you didnt 

Good advice.
Doesn't matter how many times I told colleagues to tell HMRC when they got a new car, many just didn't and were then shocked/annoyed when it gave them grief.
Invariably it would be that they got a new company car in something like the April, but the company wasn't completing the P11D advising HMRC of the changes until the October.
So they were hit with back tax.

AdrianC

benkbenkbenk said:

I don't see how that holds up. I had no choice about having the car available to use, Arval just failed to collect it on time. I had no idea when it was going to be collected to so had to arrange another means of transport. The lease had ended, so I wasn't even sure if i was allowed to drive it. If Arval still hadn't collected it a year later would i still be paying company car tax even now?

Edit: - My company informed HMRC that it was not available for use on the lease expiry date. However I am now completing a self assessment, and HMRC are showing me as owing additional tax for last year, which I have worked out is due to this disrepency on my P11D, which now shows the car as being available until October.

If the car had been taken to your employer's premises, the keys handed to the car administrator in HR, and it had been left for collection there, your liability would have ceased when it stopped being available to you.

comeandgo

If the lease had ended then I assume the company insurance you had also ended so the car was not available for your use.  You should not be taxed on a car that is sitting on your drive, in fact I would have charged storage costs.

Grumpy_chap

benkbenkbenk said:

Hi,

My company car tax was still collected for three months after the lease ended last August. This was because Arval were struggling with the impact of COVID at the time, and didn't manage to collect my car until October. I was moving to a company car allowance, and tried to arrange with Arval to collect the car on the end of the lease, but they couldn't confirm a date for collection.

I had to chase them and chase them to finally get a date confirmed. I had gone out and purchased myself a car to be ready for the date the lease ended, as I had no idea when Arval would collect, and didn't use the company car during the three months it was sat outside my house waiting to be collected.

However HMRC are saying that because the car was available for use I am still to be taxed. Surely this isn't right?

Any advice would be greatly appreciated.

If I read that correctly, the lease expired 31st August 2020 and ARVAL failed to collect until late November 2020.  COVID is an understandable reason for that delay.

If the lease had ended, then the employer probably stopped paying the lease rental and the car was not available to be used (even though in the OP's possession).

Can the OP confirm with the employer when they ceased making the lease payments?

benkbenkbenk said:

I don't see how that holds up. I had no choice about having the car available to use, Arval just failed to collect it on time. I had no idea when it was going to be collected to so had to arrange another means of transport. The lease had ended, so I wasn't even sure if i was allowed to drive it. If Arval still hadn't collected it a year later would i still be paying company car tax even now?

Edit: - My company informed HMRC that it was not available for use on the lease expiry date. However I am now completing a self assessment, and HMRC are showing me as owing additional tax for last year, which I have worked out is due to this disrepency on my P11D, which now shows the car as being available until October.

The P11D should show the same as the lease expiry date that the company say the vehicle was not available after. 
If there is a discrepancy in the P11D, then the employer needs to correct this and resubmit.
The HMRC will usually only go on the basis of the P11D that has been submitted.

benkbenkbenk

I will have to check with my employer but I can’t see why they would have continued to pay the lease after the lease end date. Then I guess I’ll need to get on the phone HMRC! Thanks for all the responses

sheramber

Your employer will need to advise HMRC of  any change of date on the P11D.

HMRC will not change on your say so.