New car for work

cyber69

cyber69

cyber69

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Joined
16 Sep 2009
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Loogabarooga
Hi all, my company car is going back at the end of October and I am being told I will be put on a car allowance of about £350 a month plus claiming back mileage at the current government standard rates.

I've no idea if to do a personal lease for 24 months with or without maintenance included or to get a car loan of £10k. I've got about £2k saved to put towards also.

Not really sure if I will be continuing doing my current mileage of about 500-600 a week so yearly mileage would be 20k to 25k business miles.

Any recommendations on car and leasing companies? Really out of my depth here.

Or just to find another job!
 
Will there be any restrictions associated with receiving the car allowance, such as age of car, emissions performance etc.?

This may well dictate some of your thinking to you - i.e. if they say your car has to be sub 4 years old and under 110g/km CO2, you'll find your options are limited anyway.
 
Kenai said:
Will there be any restrictions associated with receiving the car allowance, such as age of car, emissions performance etc.?

This may well dictate some of your thinking to you - i.e. if they say your car has to be sub 4 years old and under 110g/km CO2, you'll find your options are limited anyway.
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I think there is basic limitation like has to be large enough to carry basic tools and no older than 10 years.
 
cyber69 said:
Hi all, my company car is going back at the end of October and I am being told I will be put on a car allowance of about £350 a month plus claiming back mileage at the current government standard rates.

I've no idea if to do a personal lease for 24 months with or without maintenance included or to get a car loan of £10k. I've got about £2k saved to put towards also.

Not really sure if I will be continuing doing my current mileage of about 500-600 a week so yearly mileage would be 20k to 25k business miles.

Any recommendations on car and leasing companies? Really out of my depth here.

Or just to find another job!
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Honestly, and I know its easy to say over the internet and I don't know your situation, I wouldn't be rolling over too easily on that. I'd imagine your company car is stipulated in your contract so what they are suggesting should be part of a new terms package that needs to be agreed (signed) by both parties. If they are expecting you to do 25000 business miles a year for an allowance of £4.2k a year they are taking the pee. 17p/mile to cover maintenance, insurance (inc. business use), depreciation etc. no chance!

If your company car was more of a perk and not required for work use then my view would be completely different but your employer is expecting you to bank role an essential resource for doing your job.

All that said, if you do have to relent then get yourself a 2.5L petrol hybrid. Shouldn't be too expensive on fuel but you can extract 24p/mile for petrol at current HMRC rates from them.

EDIT - also, to refer back to your original question I would consider buying around 5 years old, as low mileage as possible, and budget to effectively reduce the cars value to zero after 4 years. Whatever you can get for it after 4 years is a bonus and can be your deposit / added to the pot for your next car. Your employer probably won't like it but anything else is going to shaft you right in the bank balance.
 
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lordrobs said:
If they are expecting you to do 25000 business miles a year for an allowance of £4.2k a year they are taking the pee. 17p/mile to cover maintenance, insurance (inc. business use), depreciation etc. no chance!
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This will be a taxable benefit too, much as the company car was - so a little bit of swings and roundabouts in that tax will be payable on the £350pm but he'll no longer be paying BIK on whatever his company car was - so this may end up being a little less or little more in reality, depending on earnings, tax position and what the current company car is.

lordrobs said:
All that said, if you do have to relent then get yourself a 2.5L petrol hybrid. Shouldn't be too expensive on fuel but you can extract 24p/mile for petrol at current HMRC rates from them.
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Absolutely this and also remember, as it's technically a personal vehicle as far as HMRC are concerned, you're entitled to 45p/25p rates tax free, so you can claim tax relief on the shortfall to those figures too.
 
Kenai said:
In which case i'd be trying to buy something 3 to 6 years old - leasing for 25k per year will probably be horribly expensive.
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Got a quote for £350 a month for a 24 month lease, maintenance and £1.2K upfront that's on a new Skoda octavia 1.5TSI SE tech with 20K miles a year and excess charged at 10p per mile.

Would need to add insurance ontop though but i'd be saving on company car tax so not sure if it evens itself out?
 
cyber69 said:
Got a quote for £350 a month for a 24 month lease, maintenance and £1.2K upfront that's on a new Skoda octavia 1.5TSI SE tech with 20K miles a year and excess charged at 10p per mile.

Would need to add insurance ontop though but i'd be saving on company car tax so not sure if it evens itself out?
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Don't forget you'll be taxed on your car allowance, so as per post above, depending on various other factors, you may actually be looking at less than £350pm in your pocket. If you're a 40% tax payer and your BIK commitment was tiny on your company car, you could be nearer £250pm actually making it into your pocket instead of a company car.

Edit - whatever you do, don't rush into committing yourself to a £9,000-£10,000 2 year lease without fully understanding the figures you're dealing with in detail. Maybe even buy a cheap run-around for a couple of months to give you some thinking space.
 
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Kenai said:
Don't forget you'll be taxed on your car allowance, so as per post above, depending on various other factors, you may actually be looking at less than £350pm in your pocket. If you're a 40% tax payer and your BIK commitment was tiny on your company car, you could be nearer £250pm actually making it into your pocket instead of a company car.
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I'm only base rate tax so after tax and NI it would be around £280/£290 so not very much per month for geting a lease car.
 
Kenai said:
Don't forget you'll be taxed on your car allowance, so as per post above, depending on various other factors, you may actually be looking at less than £350pm in your pocket. If you're a 40% tax payer and your BIK commitment was tiny on your company car, you could be nearer £250pm actually making it into your pocket instead of a company car.

Edit - whatever you do, don't rush into committing yourself to a £9,000-£10,000 2 year lease without fully understanding the figures you're dealing with in detail. Maybe even buy a cheap run-around for a couple of months to give you some thinking space.
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I'm being tupe'd over back to a company I worked for 4 years ago who got rid of company cars and only offer a car allowance. In that 4 years we have been tupe'd twice and this will be the third time so as you can appreciate getting 'fixed' in for 2 years on a car might not be the best decision.

So i'd be looking to buy a car for about £12K tops.
 
cyber69 said:
I'm being tupe'd over back to a company I worked for 4 years ago who got rid of company cars and only offer a car allowance. In that 4 years we have been tupe'd twice and this will be the third time so as you can appreciate getting 'fixed' in for 2 years on a car might not be the best decision.

So i'd be looking to buy a car for about £12K tops.
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Octavia SE Technology is a good shout. It's the general fleet / company car spec one (all the essential kit at a decent price) so there are stacks of them around. One of those on as lower mileage as you can afford would be a good shout. Unfortunately for your budget I think they will mainly be 1.0 TSI's putting them in the lowest rate fuel bracket. If you could find a 1.5 TSI (therefore getting an extra 2p/mile fuel allowance) you stand more chance of your work miles being covered by your expenses.
 
Doing 25k business miles a year in your own car is wild. What’s the score if your car breaks down or needs a repair that’s going to take a few weeks? In a company car, that’s their issue to figure out. The only way for you to mitigate that would be to tie into a lease but that’s putting you in a rubbish position if you move jobs or they let you go.

What’s the job market like in your field? If it’s decent, I’d be looking for a move. And I’d politely let the company know you’re looking to move and why.
 
monkey_boy said:
Doing 25k business miles a year in your own car is wild. What’s the score if your car breaks down or needs a repair that’s going to take a few weeks? In a company car, that’s their issue to figure out. The only way for you to mitigate that would be to tie into a lease but that’s putting you in a rubbish position if you move jobs or they let you go.

What’s the job market like in your field? If it’s decent, I’d be looking for a move. And I’d politely let the company know you’re looking to move and why.
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I've been looking for something closer to home but the jobs listed are all 6K lower than what I earn with oncall added in. Still waiting to hear from the company to let me know how much they are offering to pay for the car allowance or if they will do a U turn and supply a company car but I know the lead time for delivery on lease cars which are
instock are 4-6 weeks and the TUPE goes ahead after 31st October.

I'm not sure what my position is if I say that due to the high mileage my job now entails means that I cannot afford to get my own car (also they presume I have savings for a deposit on a car). Can they just say i've made myself redundant?
 
It's been well over a decade since I was TUPE'd but I thought that your terms and conditions were meant to be matched during the process.

Six grand pre tax and deductions may end up a decent deal if it means you aren't running your own car for 25000 business miles at a cruddy rate. Its hard to go backwards in salary on paper though and its hard to make that gap back up.

No need to say you can't afford the car either, just tell them that you've priced up a lease for the companies mileage requirement and their allowance doesn't cover it.
 
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No chance of another company car and they are offering £4100 a year for a car to cover 20-25k business mileage a year. On top of that been told that I need to provide myself with a mobile phone to include international calling for £29 minus tax a month as they no longer offer a company mobile.
 
Ouch. Did they confirm any restrictions on the expected car (age, mileage etc.)? You'll get absolutely rinsed on a lease deal at that sort of mileage so all you can do is minimise your losses by going for an older car, which has lost a chunk of value in depreciation, then run it for as long as possible. Insurance alone on a 25k business mile policy (plus whatever you do privately) will be a fair wedge of cash.

That really is bad form. **** happens on the roads and the more exposed you are to them the more you are likely to rack up costs. My business mileage has only been 15k for the last few years yet in that time I've had;

Debris hit the side of my car on the M2 requiring a new window and three panel respray
Replacement windscreen
Repaired windscreen
Replacement tyre (pot hole)
3 epic stone chips plus countless minor ones
Bonnet scratched by someone dragging, I assume, a bag across it in a hotel car park

All picked up during business trips. All covered by the company because it's their car. Well, not the scratch and stone chips because I couldn't be bothered getting them done but that was my choice.

The phone thing is just salt in the wound but hopefully a cheap SIM (if such a thing exists for international calls) and a basic SIM free phone will even out on that over enough time.
 
cyber69 said:
No chance of another company car and they are offering £4100 a year for a car to cover 20-25k business mileage a year. On top of that been told that I need to provide myself with a mobile phone to include international calling for £29 minus tax a month as they no longer offer a company mobile.
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I would consider looking elsewhere. I’m sure it’s not uncommon to request things like that, but it doesn’t make it okay/reasonable.



If I took a job and the company expected me to take out my own phone plan and car for 20k miles a year (albeit with a contribution) I’d tell them to look where the sun don’t shine :P
 
cyber69 said:
No chance of another company car and they are offering £4100 a year for a car to cover 20-25k business mileage a year. On top of that been told that I need to provide myself with a mobile phone to include international calling for £29 minus tax a month as they no longer offer a company mobile.
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Tell them to go **** themselves.
 
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