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  • FIRST POST
    • rakeyshpatel
    • By rakeyshpatel 10th Feb 18, 12:00 PM
    • 10Posts
    • 8Thanks
    rakeyshpatel
    Company Car + Fuel Card vs PCP+Fuel Card
    • #1
    • 10th Feb 18, 12:00 PM
    Company Car + Fuel Card vs PCP+Fuel Card 10th Feb 18 at 12:00 PM
    I have never had the pleasure of company car and hence this is new area and one, quite frankly, I am bamboozled by! I am hoping someone can provide some assistance -

    I currently have my own Audi 2017 A4 on PCP and paying 240 per month. I use this to commute to and from work. My company provides me with 450 car allowance per month PLUS the Fuel card (can use my car for upto 500 private mileage excluding to and from office). I expect to do no more than 12,000 mileage a year (inc travel to and from home and any extra personal mileage)

    We have just been informed, we can now avail a company car and I am tempted by it purely to cut down cost of Insurance, Road Tax, Servicing etc. Offer I have is -

    2018, Audi A3 Sportback 5 door (103 Co2), Plus Fuel Card (can use my car for upto 500 private mileage excluding to and from office). Online portal of the lease provider I use, says, as 40% Tax payer, I would pay 5,590.20 (car Taxable BIK) Plus 169 per month on private fuel = 366 per month!

    I hope some of you haven't hit BACK button already If you haven't thanks, here is the question -

    Where am I better off?

    HMRC Calculation is quite different (shows 2,540.80 Car BIK + 2,340.80 Fuel BIK) which has thrown me off completely

    Any help is appreciated
Page 1
    • Dazed and confused
    • By Dazed and confused 10th Feb 18, 12:29 PM
    • 2,629 Posts
    • 1,258 Thanks
    Dazed and confused
    • #2
    • 10th Feb 18, 12:29 PM
    • #2
    • 10th Feb 18, 12:29 PM
    Your figures don't really make sense!

    Online portal of the lease provider I use, says, as 40% Tax payer, I would pay 5,590.20 (car Taxable BIK) Plus 169 per month on private fuel = 366 per month!

    You need to differentiate between the benefit - essentially this is the extra "income" the car and fuel equates to.

    Once you know that you can work out the tax payable.

    Difficult for anyone to say much about which figures might be correct as you given us the first bit of the puzzle, the price of the car for tax purposes.
    • singhini
    • By singhini 10th Feb 18, 6:33 PM
    • 335 Posts
    • 200 Thanks
    singhini
    • #3
    • 10th Feb 18, 6:33 PM
    • #3
    • 10th Feb 18, 6:33 PM
    I cant get your figures to calculate so cant comment on your personal circumstances.


    Ive always understood the calculation to be something like this:
    Car cost x BIK band rate x your tax rate = annual cost to you


    So for me and my car as a 40% tax payer its:
    34,900 x 9% = 3,141 x 40% = 1,256 annual cost to me.


    Perhaps your 5,590 represents my 3,141 and your 2,540 represents my 1,256


    Also how much a car costs you will also depend on when you get it i.e. will you have it for the full 365 days or part way through a tax year.


    Also the BIK band rate changes every year (so for me in year 1 its 9%, then 13%, then 16%).


    Diesel cars carry a 3% surcharge each year, so if you had a 2.0l petrol Audi A3 and your BIK rate is 13%, then the same car as a diesel will be 16%


    Also, are you going to put extras on the car? because that effects the amount of tax you pay and the overall value of the car


    Lastly, don't rely on me, I'm no expert
    • rakeyshpatel
    • By rakeyshpatel 10th Feb 18, 8:08 PM
    • 10 Posts
    • 8 Thanks
    rakeyshpatel
    • #4
    • 10th Feb 18, 8:08 PM
    • #4
    • 10th Feb 18, 8:08 PM
    Ive always understood the calculation to be something like this: Car cost x BIK band rate x your tax rate = annual cost to you

    So for me and my car as a 40% tax payer its: = 34,900 x 9% = 3,141 x 40% = 1,256 annual cost to me.


    You are right., this adds up as you say to a point. Car Cost 25,409 * 22% (BIK Rate!!!, does this depend on personal salary or the type of car you choose?) = 5,590.


    Now, simple question at this point is -

    Car allowance of 5,700 Car Allowance for 40% Tax rate payer? OR
    Taxable Car Benefit of 5,590 for 40% Tax payer?


    I am torn as I am paying for my PCP 240 a month + Insurance and other running costs! What makes it further complicated is, I have a company fuel card which covers me to and from work as well as up to 400 personal miles a month (we have to submit once a month). I dont do any more than 50 personal miles a month.

    • 00ec25
    • By 00ec25 10th Feb 18, 8:11 PM
    • 6,496 Posts
    • 6,035 Thanks
    00ec25
    • #5
    • 10th Feb 18, 8:11 PM
    • #5
    • 10th Feb 18, 8:11 PM
    Lastly, don't rely on me, I'm no expert
    Originally posted by singhini
    the only thing you need to do in order to become an expert is use google....

    https://comcar.co.uk/newcar/companycar/taxcalc/?clk=1

    1. car/van make

    2. car/van model

    3. fuel type

    4. exact model name...

    5. enter any contributions made by you as an employee

    6. read the answer...

    optional...

    7. check above result against HMRC calculator

    http://cccfcalculator.hmrc.gov.uk/CCF0.aspx

    8. pay the tax...
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