Company car alternatives

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iseverynamegoneiseverynamegone Frets: 1576
edited November 2018 in Off Topic
I’ve had a fully expensed company car for 18years but may be in a position soon get an allowance instead. 

My current policy would allow me say a £40k Merc/Audi.  

Is there a simple way to estimate to what I should be looking for as an allowance? 

No details on new potential policy yet.  Unsure whether I would flat out lease/PCP/HP.  

Hopefully will I’ll be allowed upto 5year old and then I buy 2-3 old and run for 2-3years on HP. 
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  • My scheme wouldn't let me get quite as expensive a car, and the cash allowance is £425 per month. So yours is possibly around £500 per month at a guess.
    Just ask your HR team, or check your company intranet.
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  • SporkySporky Frets: 27582
    I don't think there's a simple way.

    First work out what you're paying in company car tax. Then add on the car allowance (minus tax and NI as I assume it'll be paid as salary). That's what you've got yo spend on a lease, insurance, fuel, and servicing (assuming that's not included).

    Then have a look at lease costs, which will vary widely. Don't assume that a cheaper car is cheaper to lease - at work we have a chap with a poverty-spec 1.6 Astra who is paying more per month than the chap with an A3 saloon. 
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  • Yes to be clear its not that I don’t have HR’s number,  just waiting for a potential offer on a new job which has an allowance rather than CC scheme and want a heads up on what would be reasonable. 

    I guess at £500 that would mean £250 after tax plus add to that the £300 tax a car would cost me in BIK so £550 ish actual. 
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  • SporkySporky Frets: 27582
    That sounds plausible. If you had a fuel card there's huge tax on that too, and factor in any mileage allowance if you do business miles. 
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  • dindudedindude Frets: 8534


    I guess at £500 that would mean £250 after tax plus add to that the £300 tax a car would cost me in BIK so £550 ish actual. 

    That's the way I work it out too. Company cars at my place are prob in the 30K - 35K bracket and I get near £600 cash allowance so £500 seems on the lowish side if anything.
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  • Yes I got rid of private fuel card about 8 years ago.  Really bad idea to keep that. 
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  • I'm in this situation myself at the mo. Was looking at opting out due to the current company car tax rates. I could probably have made around £100/month if everything went smoothly .eg. no accidents etc.
    I do around 25-30k miles a year so lease deals were too expensive .That means buying a diesel, and given the legislation that's coming into force regarding emission zones the depreciation could be huge in 3-4 yrs time when i come to move it on. This could wipe out any profit.

    Another thing to consider is that all new diesels are being retested and the new (higher) emission figures will be used to calculate company car tax from 2020 which will add considerably to your tax bill.

    IMO If you can have a decent hybrid/plug in company car go for that eg. the Merc E class plug in only costs around £70/month in tax!

    If you cant get a hybrid/plug in opt out if you can get a good deal on a lease or not worried about resale value.

    If your sticking with a diesel company car pay attention to the new emissions.

    Fortunately my company have added Hybrids to the car list so I've gone for that option 



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  • Yes was looking at C350E estate or GTE as next CC as need to tow occasionally.  Also Superb will be out next year with the VW hybrid power which will be interesting. 

    Thanks for the info. 
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  • grungebobgrungebob Frets: 3299
    I receive £575/month and 20p/mile. I buy what I want within that budget and resale isn’t a concern as work have paid for the car. At then end of each tax year I submit a claim to HMRC for tax relief on the other 25p/mile. 

    You may be buying the car but work is paying for it. Keep that in mind.  The extra money in your pocket from not having a K code needs to be factored in as well. 
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  • I’ve had a fully expensed company car for 18years but may be in a position soon get an allowance instead. 

    My current policy would allow me say a £40k Merc/Audi.  

    Is there a simple way to estimate to what I should be looking for as an allowance? 

    No details on new potential policy yet.  Unsure whether I would flat out lease/PCP/HP.  

    Hopefully will I’ll be allowed upto 5year old and then I buy 2-3 old and run for 2-3years on HP. 
    I think we used to get around £300 net per month. Then again my allowance on the car list only stretched to a 40k Merc because it was one of those plug-ins and was seriously cheap compared to the same spec diesel.
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  • Well it looks like the new job is happening with £700 pcm car allowance and 45ppm. No restrictions on age  or make.  Seems a very good policy. Now the tricky part of deciding what to buy and how much to spend. Those 280 4x4 Superbs look the dogs if you need to do the family car/room thing with a bit of fun thrown in. 
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  • jrc2806jrc2806 Frets: 64
    Sounds like a great policy - I receive a cash allowance but we can only claim for fuel at (in my case) about 13ppm. The 45ppm is for colleagues who use their own vehicle which is unfunded. Enjoy the search!
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  • strtdvstrtdv Frets: 2356
    280 Superb is a great car (looked at one myself) but I found the last generation DSG (compared to the new 7 speed DSG on say a golf R) to be a bit average.
    It's also thirsty in the real world (30mpg rather than the 40mpg advertised)

    Basically you've £700 a month to spend, you do lots of miles so you reckon PCP is out and you like a quick estate?
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  • strtdvstrtdv Frets: 2356
    Basically you're in the very nice position where the car will be your own and the company is paying for the running and depreciation.

    If it were me I'd take out a bank loan to be paid back at £700 a month over 3 years and save 20p per mile of my mileage allowance to put towards the next car. Then I'd buy a nearly new S4 Avant, C43 estate or 540i estate
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  • grungebobgrungebob Frets: 3299
    Don’t forget you can claim the tax back on any mileage under 10k where you don’t receive 45p/mile. It’s easy. 
    My company pay 20p/mile but I claim the tax back on the remaining 25p/mile. Last year I got about £550 back. 
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  • If you do more than 10k miles pa, do you have to pay tax on the 45p per mile (for miles in excess of 10k)?
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  • Yes I think that’s the case. 
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  • dindudedindude Frets: 8534
    With my car allowance I’ve taken a personal lease the last few times and it’s great fun trying to find the right deals and “cheat” the system. Tricks are: find the deals where the manufacturer is activity trying to get some out on the road, with decent depreciation, and a model with all the kit included as any options are basically charged for in full over the lease term.

    Just ordered a VW Arteon on a stonkingly good deal.
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  • iseverynamegoneiseverynamegone Frets: 1576
    edited January 2019
    Yeah I like the Arteon , what sort of price you got? @dindude ;
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  • iseverynamegoneiseverynamegone Frets: 1576
    edited January 2019
    strtdv said:
    280 Superb is a great car (looked at one myself) but I found the last generation DSG (compared to the new 7 speed DSG on say a golf R) to be a bit average.
    It's also thirsty in the real world (30mpg rather than the 40mpg advertised)

    Basically you've £700 a month to spend, you do lots of miles so you reckon PCP is out and you like a quick estate?
    Yes I test drove a new A6 today and thought the pick up on the gearbox a bit slow.  I did have the superb 190 auto a few years ago and remember the auto box on that was lovely.  This wasn’t as good. 

    I worked out the difference in fuel for the 280 V 190 diesel was about £800 a year based on 15k miles (and using 30mpg as honest John told me so).  In context it doesn’t seem like too much to have a little more fun but will test drive both later this week. 
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