Company Car Tax Help Please :)

Clark-Kent_3

Hi i have just started a new job with a company car and £34k a year and for the first year a guarenteed 10% of salary bonus for the first year making it £37400 firstly does this put me in the 40% tax bracket even so i'm aware i only get taxed 40% on the amount over the cutoff but when calculating the company car tax for a particular model does that work the same or just on base salary not dependant on the bonus???

Any help would be much appreciated
Thanks

wotsthat

The company car has a value as if you were paid cash and you need to add this to your basic salary and bonus to arrive at your total taxable pay.

If you have a look at www.hmrc.gov.uk and search for "company car tax" you'll see how the taxable value of a car is calculated but effectively it's a certain % (depending on CO2 output/ km) multiplied by the cars list price when new. If your company pay for fuel for private use as well then this has a taxable value as well.

With your basic/ bonus minus personal tax allowance you'll be a standard rate taxpayer. With the car (& fuel) it'll take you into the higher tax bracket.

If you are making pension payments though then you'll get tax relief on the contributions so this might get you back into basic tax land.