Company Car Question

[[TW]Fox]

Take car allowance.

Purchase 18 month old C320 CDI.

Purchase £250 DVLA private plate.

et voila. You have a car that is better than the poverty spec base model crap on the company car list, you are financially better off and as a bonus you are far more 'DRESSED FOR STARDOM' in your C320 CDI Sport than the guy in the Leaseplan C220 BlueEfficiency.

And you've still got a warranty and everything.

Earning £31k and buying a car > Earning £25k and paying car tax on a bottom of the range company car.

'Sorry Bob, I know you've been here 3 years and you've impressed our clients but I'm afraid the job of senior developer is going to Dave, because, well, because he took a Leaseplan Merc whereas you bought your own'

'Yes, Mr VFM. Thanks for attending the interview. You interviewed well but on this occasion we've not been able to offer you a position. Sorry about that. Unfortunately it was your car. Yes, very nice the C320 CDI, but I couldnt see a Lloyds TSB Autolease sticker in the window so you obviously own it yourself, so I gave the job to somebody with a Golf'

 

[Wicksta]

With all due respect VFM, you're retired - in my parents days (mother recently retired) company cars were a good idea but not so much these days. I'd be driving a Ford Focus or Insignia on my grade at work - nothing wrong at all with these cars but I own my own 2 year old BMW 530i so by your standards by taking the money option I'm more dressed for stardom.

 

[GuruJockStrap]

In this case, your allowance is so generous that it makes no sense at all to take the car.

That is a very nice package for someone on £25k!

It's actually more than that to be honest Just gave that figure as an example.

 

[GuruJockStrap]

I drive to and from my place of work. My job doesn't see me driving out and about. I couldn't give a stuff what car I drive or the perception of it to other people.

If I want to impress in an interview for a new job, I'll go and hire a car for the day.

 

[Wicksta]

I drive to and from my place of work. My job doesn't see me driving out and about. I couldn't give a stuff what car I drive or the perception of it to other people.

If I want to impress in an interview for a new job, I'll go and hire a car for the day.

Well it could be a lucrative business - rent out poverty spec BMWs 320d ES or C220 Mercedes and if someone like VFM is looking out of the window the job is yours.

 

[VFM Addict]

I drive to and from my place of work. My job doesn't see me driving out and about. I couldn't give a stuff what car I drive or the perception of it to other people.

If I want to impress in an interview for a new job, I'll go and hire a car for the day.

I have no idea where you got the impression I was suggesting you took the CC to impress your current employers? Internal Career Smarts call for a totally different set of approaches.

As regards interviews, you plainly did not read my post No.39 above. Even Self-purchase doesn't really work. Hiring a car for an interview is even more bonkers. "Nice car you have there Mr Grub what did it cost you?" Reply, "Oh its not mine. Its just that I hired it to impress you.". MASSIVE - FAIL.

It is sad but as one peep said image does play a vital role at interviews. Far, far more than people think. After all, potential employers know your skills and background from your CV even before they meet you. Interviews are almost exclusively about image and chemistry. And image can begin when the interviewer sees you pull up in your car. Finding out later that you only hired it almost defines one as a fraud there and then. After all no-one hires a Merc just to get from A to B do they. A Fiesta or Focus would do that. The Merc was plainly just to project an untrue image. That is the way an interviewer would read it 99/100.

Look, the nature of best possible advice is not such that one is ever obliged to take it. I am simply giving you that which I know to be best possible advice. The reality is though that if you do not see yourself moving on in the next year or two for an extra £8k-£10k then probably sticking with the Skoda makes sense; as long as you put the extra allowance aside to cover unexpected costs.

However, if you plan to grow your career/income proactively and rapidly then the CC has many merits.

 

[mbmbmb]

Whatever your decision, the cars you are being offered for that amount arent very good.

As an example, our plan is £525 and we have f10's and C270's on the list. (The new E is probably also on their, but i havent seen the list since it came out)

Also our provider allows us to source our own car/deal (from their original list) and if its better the provider will purchase it for us. I would look into this if you are going to go CC route, as I'm sure you can get a better deal than those.

 

[Rotty]

the car allowance compared to the cars very much favour the allowance

my choice was equal/better cars or £462 a month and I still chose the cash

 

[[TW]Fox]

As regards interviews, you plainly did not read my post No.39 above. Even Self-purchase doesn't really work. Hiring a car for an interview is even more bonkers. "Nice car you have there Mr Grub what did it cost you?" Reply, "Oh its not mine. Its just that I hired it to impress you.". MASSIVE - FAIL.

As opposed to..

'Nice car, what did it cost you?'
'Oh, its not mine. It's owned by Lloyds TSB Auto leasing, my company pay for it. It'll get taken off me when I leave'



Surely..

'Nice car, what did it cost you?'
'It cost enough! I bought it a year or so back'

Is far better. Because hey, OWNING YOUR OWN Mercedes is better than borrowing somebody elses right?

It is sad but as one peep said image does play a vital role at interviews. Far, far more than people think. After all, potential employers know your skills and background from your CV even before they meet you. Interviews are almost exclusively about image and chemistry.

So pull up in your very own top of the range Mercedes rather than a lease base model one. Your own argument is defeating the point you claim to be making.

However, if you plan to grow your career/income proactively and rapidly then the CC has many merits.

No, it almost completely devoid of any merit in those circumstances. Owning your own decent car is far better - the 'image' is the same if not better and you don't lose it when you move jobs!

Your posts in this thread remind me of a Gareth Cheeseman sketch. Perhaps back in the 80's the be all and end all of life was whether your company car was a Sierra GLS or whether you'd MADE IT in the sales world and got a Sierra Ghia, but that was a long time ago.

 

[[TW]Fox]

the car allowance compared to the cars very much favour the allowance

my choice was equal/better cars or £462 a month and I still chose the cash

You are doing it wrong Rotty, VFM says so. If you had CAREER SMARTS you could be DRESSED FOR STARDOM in a bottom of the range C Class rather than driving around in your Porsche as you do with your car allowance.

 

[PeterNem]

Internal Career Smarts call for a totally different set of approaches.

If those 'Career Smarts' result in me driving the lowest common denominator of a prestige car designed solely to be sold into the fleet market only to then retire into a Colt or a C3 Piccaso... I'd rather steer well clear, thanks.

 

[Jez]

This is turning out to be one of the most bizarre threads of the year so far!

VFM Addict - you are quite simply misguided. You clearly have no idea of the tax implications, and are now trying to save face by coming up with utter rubbish to defend yourself.

This about interviews!? You seriously have had interviews which have gone like that? If i were asked what my car (which looks rather flash in the world of company car carparks) cost me in an interview my face would be of utter bemusement. I get the nice car thing, but those cars in the OP are not impressive. They are cars which any of us could match or even beat in terms of "Career smarts" (LOL) for a few grand on a whim.

The OP needs to take his advice (which he has, thankfully) from people in this thread (of whom i am one) who actually receive a car allowance instead of a company car. You dont seem to actually understand tax and the cost implications of covering business mileage in your own vehicle.

 

[Columbo]

I went through exactly this last year and I took the £575 p/m car allowance the company was offering and not regretted it for one second.

The extra I get in my salary now is simply 'banked' and not spent as running costs for my existing car were already factored into my outgoings.

You are already happy with your current motor and its not a shed so I cannot see any sense in surrendering £570 p/m when you're salary is only £25k to start with.

Honestly OP listen to the sound advice thats been offered already and take the allowance.

 

[Kenai]

Excuse the noob questions as i've not had this option presented to me yet but I was under the impression allowances often came with a stipulation that you ran a car that was only of a certain age (such as nothing older than 3 years)? Is this not the case or is it on a per company basis whether they implement such restrictions?

It seems odd that companies would be happy to (for example, based on a post in this thread) pay out £500pcm car allowance to an employee smoking about it in an old £1000 Citroen diesel who is clearly not using it on the car. Is there some benefit to them giving you a car allowance rather than a better basic salary of equivalent take home value?

 

[PeterNem]

It's just a form of non-consolidated pay. That is, they're basically giving you a payrise, but not increasing pension contributions etc as they've considered before the car allowance is given. It's also often discretional and non-contractual.

My company offers a "car allowance" of around 6000-7000 per annum for employees of a certain level, but a large number don't even own a car and there is no stipulation on how the money is used.

 

[GuruJockStrap]

The extra I get in my salary now is simply 'banked' and not spent as running costs for my existing car were already factored into my outgoings.

Thats the thing. The running costs for the Skoda have have already been factored in my current salary (insurance, road tax, servicing, etc). I've received a nice pay rise and with the car allowance on top, I'll be much better off than if I simply took a car from the list.

 

[PMKeates]

In theory whether you are already paying the Skoda's running costs or not should be ignored - the best way to appraise the options is to calculate as if you were choosing one of them from the position of not having a car (and so your current financial position is less the Skoda but plus the saleable value of the Skoda). It's the only way to see it clearly

 

[Maccapacca]

Excuse the noob questions as i've not had this option presented to me yet but I was under the impression allowances often came with a stipulation that you ran a car that was only of a certain age (such as nothing older than 3 years)? Is this not the case or is it on a per company basis whether they implement such restrictions?

They usually do, my last firm wanted <5yrs and <80k but was amending this to <3 yrs and <60k in which case I would have seriously considered a company car and then opted for a low c02 for example a 118d, however my current firm don't give a monkeys but encourage lower c02 by giving more money the lower the c02 up to twice as much per month depending on grade

It seems odd that companies would be happy to (for example, based on a post in this thread) pay out £500pcm car allowance to an employee smoking about it in an old £1000 Citroen diesel who is clearly not using it on the car. Is there some benefit to them giving you a car allowance rather than a better basic salary of equivalent take home value?

Usually it costs them less to give a monthly sum to the employee than run company cars, the benefit to the firm is reduced overheads and all the hidden costs associated the benefit to you is you get to choose the car you want or pocket the change

 

[mbmbmb]

Excuse the noob questions as i've not had this option presented to me yet but I was under the impression allowances often came with a stipulation that you ran a car that was only of a certain age (such as nothing older than 3 years)? Is this not the case or is it on a per company basis whether they implement such restrictions?
?

It will vary by company, but as a rule, yes they will all most likely have a policy guiding what sort of car you have. However, how far they enforce will come down to the company ethos, your actual car, and your standing in the company. We have a 3 year, 80k 4 door policy but several guys are running 2 door convertibles or which a couple are 5yrs old and they have no problems.

 

[VFM Addict]

I am fascinated that on numerous occasions peeps have suggested that I have effectively changed my stance. I wish people would read a thread properly or completely. My stance as been consistent; that there are many considerations beyond the pure financial implications.

Someone suggested that the car I now drive was relevant. That is plainly immaterial. How my own income has been spent over the years is of no consequence as neither are the houses my two ex-wives live in or what cars they drive.

Returning to the issue at hand I find, as is too often the case, that people have adopted a stance fixed solely in the maths of today. It is in some ways demonstrative of the old saying that – Most people are too busy earning a living to ever make any money. It also goes in part to confirming the adage that – Most people spend more time and effort in a year planning their holiday than they do planning their career progression. The Solely Today Reasoning looms large in both.

Before I get accused of going off at a tangent I would remind peeps that I stressed early on that there are other considerations than pure maths. I did perhaps err though in mentioning Career Smarts as being relevant when quite plainly few have any no idea of what such are.

It is a total fallacy that – If I do my job well I will progress. Just look at the mediocre individuals you have known who have risen to the top and the very talented individuals you know who never have progressed very far. In most cases the result has derived from whether on not the individual in question understood the concept of Career Smarts, in nature at least if not by name.

No matter what ones abilities and skills, the application of Career Smarts will invariably get you far, far higher up the greasy pole that ignoring them. To this extent the situation is far more akin to snakes and ladders than a greasy pole. Know where the ladders are or how to create ladders and sure as hell you’ll get higher and far faster.

Career Smarts are group of techniques and philosophies which stimulate and accelerate career progression most significantly. In part, as with most things in life, they are influenced by the human condition. The simplest way I could describe their impact here truly is that the impression given by someone who is provided with a Merc is that of a valued employee. While the impression given by someone who runs a new Merc in the absence of a very high income is that of extravagance. This is human nature. It is somewhat subliminal but nonetheless is for most people a conditioned response. The impression given by a shop assistant from Asda who runs a new Merc is very different from that of the middle Manager who lives three doors along and gets a Merc as a company car. While this is an extreme example the principle holds true even in circumstances where the differences between the two individuals are not as stark. One may argue concerning to what degree this may have a bearing at interview. But to argue that it may play no role whatsoever is simply to be devoid of an understanding of human nature.

Career Smarts as with Marketing Smarts are no different from Street Smarts in that they define a set of rules and philosophies that significantly and advantageously impact a situation. I presume the term Street Smarts is familiar as a term to all. For example - Don’t walk down dark allies and wherever you walk don’t or act like a victim. Both decrease very significantly your chances of getting mugged. It is no different with Career Smarts. Following the philosophies and applying the techniques very significantly increases ones chances of a favourable outcome and rapid career progression to a far higher level than one would have reached without them.

Perhaps I should write a piece on Career Smarts and post it at some point. Certainly if I become involved in a thread where I believe Career Smarts should be in at least some part considered, such as in this case, then I can simply refer people to that post so they will at least know what I am talking about. Such a piece may be interesting and enlightening to some and I don’t doubt for the slightest second that it would provoke lively discussion and debate; not least from those who have posted in this thread.