Car Allowance or Cash...?

[Sheriff Fatman]

Also, you don't lose your tax free allowance, but you'll pay more in tax each month as its getting utilised more quickly.

If you end up on a K code, which is likely, this basically says that your benefits in kind are higher than the allowance, and adjusts your monthly tax payment so that you don't end up with a massive shortfall to pay at the end of the tax year.

[ACE2M]

Not sure if its correct but i was told you need to knock out 10,000 miles a year on a fuel card to make it cost effective.

I love the company car, hassle free motoring is a joy.

[Sheriff Fatman]

Not sure if its correct but i was told you need to knock out 10,000 miles a year on a fuel card to make it cost effective.

I love the company car, hassle free motoring is a joy.

It depends entirely on the car you're driving, as it's a function of the list price and emissions, as well as the fuel consumption.

It does protect you to an extent from rising fuel prices though, as the fuel element of the BIK can only change once each year, and didnt change for many years when first brought in.

[winkie]

Thanks for all the replies...

For a £5k car allowance, what type of car could I get? Would it stretch to a BMW 320d Efficient Dynamics; decent car with low CO2 emissions? What other alternatives would people recommend?

[Sheriff Fatman]

Thanks for all the replies...

For a £5k car allowance, what type of car could I get? Would it stretch to a BMW 320d Efficient Dynamics; decent car with low CO2 emissions? What other alternatives would people recommend?

If that's the car you're going for don't use a car allowance.  It's one of the most company car friendly vehicles out there.  My 520ed was 13% BIK before I changed jobs.

£5k allowance after tax = £3kpa = £250 per month so check the leasing deals but I doubt you'll get a 3 series, particularly as you're going to be > 20k miles per year.

[kinboshi]

Have a look on here:
http://www.buyyourcar.co.uk/lease/cars/search/cars/bmw/options/pricemax/250/pricemin/200

Looks like the 1-series would fall into that price bracket, but it's worth contacting a few of the brokers on there to see what they can offer within your budget. The deals on there are usually for 10,000 miles per annum, so you'd need to get quotes for your exact requirements.

The best situation to be in is having a budget but not being set on a particular model, as you'll then be flexible to look at what the best offers are for your money.

(disclaimer: I help with the online marketing for that site, but I'm not affiliated to any of the brokers who are advertising on there).

[ScottMGee]

£5k allowance after tax = £3kpa = £250 per month so check the leasing deals but I doubt you'll get a 3 series, particularly as you're going to be > 20k miles per year.

Bear in mind in addition to the £250 per month net Car Allowance you are also saving around £100-£150 per month in company car tax so arguable you have £400 per month towards your own car.

[The Baron]

A few words of warning.

Your £250 a month is that to include servicing/maintenance/repair? Some companies will tell you it has to include a maintenance package. For your miles I'd want maintenance on your car or you're forking out for services, maintenance and tyres. Check what the package covers as well. Some companies wont include tyres, some will include limited tyres and one or two will be unlimited (ie if you get a puncture the day after changing your tyres this will also be covered).

Secondly check the payment profile. Some will charge you 3 payments up front followed by 33 payments (terminal pause). Some will charge you 3 up front followed by 35 (spread). This then means you're making 38 payments and whilst it may appear cheaper it'll mean the whole life cost will be higher and it may not necessarily then fit into your £5k per year allowance. Some brokers will charge you 6 up front which will appear even cheaper but again will probably make it more expensive in the long run.

Beware of some brokers. They will "no sell" you a maintenance package which for over 20k per year I would want. Also a lot have sign up fees or admin fees. After sales service can be pretty bad too.

Realistically you wont get a 3 series (or even a 1 series) for your budget but there are some good sub 100g/km cars out there which will keep your BIK down.

[Waz1892]

Thanks for all the replies...

For a £5k car allowance, what type of car could I get? Would it stretch to a BMW 320d Efficient Dynamics; decent car with low CO2 emissions? What other alternatives would people recommend?

I get £5k allowance too and I looked at the above and the CL220 merc. Test driving it this weekend. Awesum car! Test drive the BM in 2 weeks.

That said neither car is under the £5k so I will have to payout from wage.

BM is better std options, better co2 and cheaper by £12 per month with the rates we get charged.

But the merc is well a merc, always wanted one.

Any car under co2 of 120 tax is good.

Company car over cash for me everytime. Peaceful driving. Massive benefits to having one.

Tax, insurance, maintaince, mot, tyres, windows, breakdown.

New 1 every 3 years.