Yet another company car question..

Tenzo · 1 Jul 2015 at 19:00

Just after a sense check to my thinking on the car vs. allowance conundrum that pops up and bores everyone now and again.

My position is this.

Option a)

Source the car myself, with a net allowance of £300 pcm. Insurance is covered by the company, but all other aspects are my responsibility. There are some restrictions on the car, in terms of age but otherwise I am free to choose what I want.

Option b)

Get a company car and have everything paid for, but pay tax.

Now to make the comparison objective, I am trying to factor in running costs that I have to cover when looking at sourcing the vehicle myself, as well as the cost of the car (assuming I take a PCP agreement with minimal deposit, ignoring the balloon payment). All calculations are based on 4 years.

TLDR:

If the car costs £150 on BiK tax. I have £450 (£300 allowance + £150 tax) to fund my privately sourced option to get back to the same point.

Am I missing anything?

Tenzo · 1 Jul 2015 at 19:06

My mileage will mostly be private, so I was not factoring that aspect in (rightly or wrongly)

Tenzo · 1 Jul 2015 at 23:10

So mileage aside, I'm pretty much there?

Does anyone have some good recommendations for private sourcing outside of main dealer PCP deals? I read another post that private leasing is a possibility, but is generally the most expensive option.

Obviously good deals in any situation change what's best but if anyone has some good sites to look at would be grateful

Tenzo · 1 Jul 2015 at 23:40

Not chosen anything. It would be new, so whatever I want within reason. Probably consider an A6 black sort of level as top whack, realistic would be more Passat GT or Octavia vRS

Edit

Tenzo · 2 Jul 2015 at 17:11

Yeah sorry if not clear, the 300 is after tax and NI.

Business mileage, maybe 1-2000 a year

Tenzo · 3 Jul 2015 at 14:06

Thanks all for the reponses. I'll disregard mileage, simply because my bus. mileage will be minimal each year but understand why it's a factor.

Net allowance + BIK payable = own vehicle + running costs

Tenzo · 6 Jul 2015 at 22:16

So, I'm pretty keen on the Octavia vRS diesel.

It so happens that Skoda have them on 0% finance offer at the moment, so assuming I could get that, I've run some numbers.

biK wise, it will cost me about £170 pcm to get this on the company car scheme.

I've been quoted £319 pcm to finance on PCP for 42 months, plus a balloon payment at the end. I would receive £300 pcm as an allowance (after tax/NI), thus costing me £20 so to speak.

That leaves £150 difference each month to cover servicing, tax, tyres over the life of the car. £1800 per annum to run a brand new car, plus a bit more hassle to organise stuff myself.

I don't really consider mileage as my business mileage is so low. I can extend the warranty to 4 years for piece of mind and insurance is paid for in both cases.

Am I missing something or does this seem like a no brainer with the allowance being a clear winner?

Tenzo · 6 Jul 2015 at 22:27

So you recommend the allowance option?

Tenzo · 6 Jul 2015 at 22:29

I was just on the main website getting a feel for the cost

Tenzo · 7 Jul 2015 at 12:18

Regardless, the main question of private sourcing vs. company car has (in this case) been answered

Thanks guys

Tenzo · 7 Jul 2015 at 12:57

Audi would be £60 this year, up to £105 by 2017/18.

Given the list price, I would have to fund £x difference myself which I have now opted to try and avoid so I do not think I would be any better off.

Surprised that the BiK doubles for car like that, pretty poor by the government.