I’m going to take a car allowance instead of a company car, and my employer has given me a couple of options but I’m not sure what my tax liability would be. Can anyone shed any light please?
option a – take the allowance, but company will pay for insurance/maintenance etc. No mileage allowance paid when using car on company business.
option b[/b] – take the allowance, pay for all maintenance etc myself, but claim the 45p a mile allowance for using the car on business.
I know that the mileage allowance is not taxable (option b), but do I have any tax liability on option a? It sounds like a benefit-in-kind to me. I’m keen on option a as it would be better for me.
HMRC website is hurting my head, there’s no-one at work I can ask right now and I need to make a decision soon.
TIA, sorry for the dull question! 🙂