Advice on company car situation please

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Advice on company car situation please

18 posts & 12 voices | Started 2 years ago by gravitysucks | Latest reply from matthewlhome

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gravitysucks - Member

Ok fuming but will try and explain......

I have a company car but have always made it clear that I would prefer not to. When the company looked at the tax situation a few years ago it was concluded that the best course of action is for us to be taxed on having a company car for personal use and for mileage to be recorded for any personal miles so that we can be charged appropriately for any petrol used. I use the car the bare minimum and record a mileage of 4 miles a day (2 into work and 2 back home).

Now As I see it the car is mine to use as and when I wish but on the few occasions I have used it personal use I have just replaced the petrol I have used instead of messing about having to record my mileage all the time.

Now I went away Wed eve to attend a family funeral and have just got home to find a shitty letter from my Boss asking why I have took the company car away without asking permission. They have basically got hump because they wanted to valet it but couldn't as I was in it.

Now as I see it I pay tax accordingly to have the car for personal use when I need it. I choose to use it the bare minimum but that is my perogative, as it is my perogative to use it when I wish....

So who's in the wrong here? should I be asking permission to use the car for personal use when I am already taxed on a yearly basis for having it or is it mine to use as and when I wish?

I should add that the other two funeral directors use there cars alot personally and I know full well that they do not have to ask permission every friday before the weekend. Contractually I have to record personal mileage for any company petrol being used so I can be charged accordingly but surely this doesn't need to be done if i'm replacing the petrol myself...

So to cut a long rant short.... If you paying tax for a full year to have a company car does the amount you use it within that year bare any relevance at all?

Cheers peeps advice greatly appreciated

PS the fact that I came home from a family funeral to find this I find just insensitive & insulting

Posted 2 years ago #
Liftman - Member

Your paying the tax on it cause its a benefit in kind, your situation sounds like it aint no benefit !

Posted 2 years ago #
carbon337 - Member

I'm having a similar issue but with a mobile phone so they are getting it back. I dont need it or want it and if i'm not there tough shit. That will stop them automatically taking money out of my pay for what they have decided is personal use.

Give the car back and claim the government set private mileage charge on your own car - i think 40p per mile - if they pay you less than that you can claim tax relief up to that amount.

Posted 2 years ago #
jockhaggis - Member

You are right, boss is wrong. Feel better?

Taxed as a benefit, so you can benefit from having it. There is no half way with company cars.

If the boos doesn't want you to take it on personal use tell him you will leave it in the office car park, only use it for business use 9-5 and therefore there will be no tax implications.

Posted 2 years ago #
b r - Member

The paying tax and your companys' policy on private use are two totally different issues.

You drive one mile of private use per tax year, you'll pay the tax.

A previous company I worked for had it so all employees with company cars received private fuel - after a couple of months I was taken to one side and told that it was only to be used to cover home-to-work, and not all private use... This was why everybody filled up on a Friday, and not a weekend. But obviously the tax was the same.

And any payment you make towards the car will act as a credit against your tax bill - you do inform the IR of this don't you?

I would suggest that you have to decide whether its appropriate to take the car home, otherwise you could leave it at work and pay no tax at all.

Posted 2 years ago #
bruneep - Member

I would leave the car at work and cycle/walk the 2 miles.

Posted 2 years ago #
uplink - Member

You need to be careful
If you have access to a company car to use personally as & when you see fit, you should pay tax on the value of the car, the same as any other company car user

Posted 2 years ago #
TexWade - Member

If the car is available for you to use personally you have a tax charge. I think it's very unlikely you could get tax charge reduced just because boss put restrictions at certain times or fir other reasons not available. For exple cannot claumvtax reduction when it's in garage bring fixed. Badiccakly not worth having a cc if you have little personal use . Why nor hand it back and use as pool car? Can't keep it at home though but if you are 2 miles from work no big deal

Answer is you nor boss or wrong, it's just tax rules for employees are very unfair and restrictive....that's why MPs have got into such trouble. They imposed a set of rules on us that they could not live with themselves

Posted 2 years ago #
prettygreenparrot - Member

The arrangements with the revenue can be very complex and can vary from company to company from what I have seen. Bear this in mind as you read further.

Either you have a company car, or you don't. If you do,then whether you use it or not you still have to deal with the various tax implications.

You can have a car that you use for company business. And that is subject to various mileage allowances. Driving to & from a regular place of business does usually count. Driving to clients or distant sites usually does.

The problem with your boss seems different from the tax concerns and seems to be confusion over whether you have a company car, or access to company cars for business purposes. I'd be inclined to read my contract and then having understood that have a chat with the boss to understand their position.

Posted 2 years ago #
gravitysucks - Member

to explain further. I am contractually obliged to have the car as I'm on call one week in three and have to have it with me 24 hrs when I'm on. basically the company is forcing us to have them at home to alleviate security concerns of leaving the cars at the office.

I would give up the car tomoz if I could, but can't.

To reiterate I DO pay the tax for the benefit of having the company car, this is calcualted annually on the basis of the value of the car and me having in my possesion for the 12 months of the tax year. As far as I know whether I use the car once or a thousand times is irrelevant.

The point my boss is making is that I should be asking permisson to use the car because I have told them in the past that I only use it for travel in and out of work; BUT the amount I use the car is my choice and being in the same boat as the other funeral directors I could use it as my sole mode of transport if I wished.

The only point i'm unsure about is whether i'm obligated to mention if I do use it when i'm paying for the petrol myself, as oppose to filling up with the company fuel card. I don't see why I need to as the others only use this information to work out their personal mileage and how much they owe the company for petrol used that the company paid for on the fuel card.

I'm 99% that the boss is just being a k nob and is shirty because he wanted the car valeting. In my eyes if i'm obligated to have the car and am paying a shed load of tax accordingly then out of work the car should be on my drive should any circumstance arise in which I want to use it.

To me they should be asking my permission if its ok to take away MY company car and valet it, as I might want to use it....

Posted 2 years ago #
uplink - Member

The only point i'm unsure about is whether i'm obligated to mention if I do use it when i'm paying for the petrol myself, as oppose to filling up with the company fuel card.

If that's what he's asking you to do, to me, that seems a reasonable request [if a little unusual] & you would therefore be obligated to comply

If, on the other hand he's asking for prior details of personal journeys, in your own time, when not on call - That would not be a reasonable request IMO & you could decline the request

Posted 2 years ago #
gravitysucks - Member

Uplink... with you saying that it seems unusual, am I right in assuming that if i'm replacing the petrol used and already pay tax for the benefit of using the car for a full year then there are no reasons from a tax point of view for recording what I use the car for personally?

Posted 2 years ago #
jim the saint - Member

This letter from your boss may prove quite lucrative to you.

If you are not allowed to use the car outside of work hours as you see fit then you shouldn't be paying tax on it. Lots of people who drive a van as part of their job are expected to keep the van at home (or somewhere safe) when they are not working, they don't pay additional tax though as the van is not intended to be used for personal journeys.

If your boss requires access to the vehicle at any time, at a set location, without prior notification then you shouldn't be paying for the privilege of having a 'company car' for personal use. Your boss is within his rights to ask you to log any mileage, whether it be work or personal though.

Do you not think though that by using a car from work (I'm presuming you work at a funeral directors) to go to a funeral that your boss might have thought that you were doing a 'foreigner' on the side?

Posted 2 years ago #
uplink - Member

gravity - my guess would be that he can ask you to do it whichever way he sees fit
If you pay full company car tax the taxman has no interest how many miles you do, only whether or not you're getting a fuel benefit
It may well be the way that your boss does his accounts though - using employees records of mileage & the accompanying payment for the fuel to show there's no fuel benefit

Posted 2 years ago #
gravitysucks - Member

Ok cheers guys. More or less what I thought...
So the boss can request that I record mileage but this is only for his purpose and not the taxman.

Basically I've had the car for the last 18 months and just don't use it personally. When I do its back fired on him as he wasn't expecting me to. His fault not mine. Contractually I only have to provide a record of personal mileage at the end of the month so he woudn't normally get this for another 3 weeks so i'm perfectly in the right (I used company petrol on this occasion so recorded mileage).

I'll hold my hand up to the only other occasions when I used it and replaced the petrol.

Either way the nobbers getting a snotty letter. I'll resist the temptation to go put it through his house door as he did to me.

Posted 2 years ago #
Dickyboy - Member

If you are paying tax on the basis that you have the use of the company car but pay for any private mileage (ie a reduced rate of tax) then the tax office are quite within their rights to ask your company for proof of this & could tax you otherwise if they are not able to provide such proof. Just filling up when you use the car is not good enough, our company has been through all this & I have to fill in daily record of private & company mileage, plus provide receipts for all fuel bought & must be "in credit" at the end of each month when mileage sheets are handed in. Might be a pain in the arse but it does ensure that I don't get a huge tax bill a few years down the line.
As regards boss wanted to know when you are driving it - that's just down to your company policy & will have no effect on the taxman.

Posted 2 years ago #
gravitysucks - Member

But my point is I have replaced the petrol in the past and not claimed for reduced petrol costs through the company. When I have used the car in the past it started with full tank and ended up the same out of my own pocket. What does it have to do with the taxman? They would only need to be informed if I am benefiting from using company fuel which I was not..
On this occasion I have recorded mileage by the book and used company fuel. I fail to see how I am in the wrong tax wise.....

Posted 2 years ago #
matthewlhome - Member

I think that you would be better off using the fuel card for everything and then paying back the tiny bit of personal mileage. You are doing some personal mileage (to work and back) and may as well let the fuel card people administer it for the small inconvenience. That is what I do (although do a lot more personal miles).

We are obliged to report and pay back for personal mileage, as that would then be another benefit (and more tax).

If you are not recording the personal mileage though, then the fuel card mileages, company accounts and reported mileages won't add up right. I doubt the revenue would like that.

Having said that, If you are using it like a van (as you have described) then you shouldn't be paying tax really. That is what all of our company technicians do - they take it home every night and use them for on call, but are not allowed to use them for any personal use. Thus no tax liability.

Posted 2 years ago #

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