Motoring Discussion > Running a car personally v on the company Miscellaneous
Thread Author: Hard Cheese Replies: 15
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 Wed 20 Apr 11 11:17 
 Running a car personally v on the company - Hard Cheese

I was self-employed until 18 months ago when I went back into the corporate world and got a company car.

I have since been made redundant, my own business has been dormant though I am resurecting it because I will now be working on a contracting basis.

I previously ran a car personally and charged my own business 40p/mile, I will be buying a 2nd hand car (diesel, around 130/140 g/km CO2) and will be doing around 15k business miles and 8k personal.

Would it be best to run the car personally and charge my company at the 40p/mile for the first 10k and 25p/mile thereafter.

My client will pay 40p/mile which will be invoiced by my business.


Many thanks.

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 Wed 20 Apr 11 11:40 
 Running a car personally v on the company - Falkirk Bairn
It is now 45p per mile - upped @ Budget
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 Wed 20 Apr 11 11:46 
 Running a car personally v on the company - Hard Cheese

Thanks FB, so if I run the car personally I can charge my company 45p/mile though my client will pay 40p/mile.



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 Wed 20 Apr 11 12:20 
 Running a car personally v on the company - Dulwich Estate
Yes
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 Wed 20 Apr 11 12:27 
 Running a car personally v on the company - Zero
Your company will be making a loss of 5p per mile.
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 Wed 20 Apr 11 12:34 
 Running a car personally v on the company - Hard Cheese

Thanks though that wasnt a question DE.


>> Your company will be making a loss of 5p per mile.
>>

Or I will be taking 5p a mile out of the company tax free.

The car will cost IRO 14-15p/mile in fuel so I will be making a net 30p/mile tax free covering servicing, depreciation etc.

Or should I run it on the company?

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 Wed 20 Apr 11 13:37 
 Running a car personally v on the company - Mapmaker
Charging a company mileage is a very efficient way of taking money out of a company tax free.

Personally I'd be surprised if it were sensible to run it on the company.

1. Your car insurance will proabably be more expensive for the company than for you.
2. You will have an extra owner on the logbook (assuming a transfer from you to Co).
3. You will pay tax on the BIK. If it isn't a brand new car then this will be the killer.
4. The company will get a tax deduction for servicing, insurance etc. plus depreciation (through capital allowances).

You should model it to work out which is cheaper.
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 Wed 20 Apr 11 13:41 
 Running a car personally v on the company - Zero
I think he plans to own and finance the car himself, and then charge his company 45p per mile, and his company charges the client 40p per mile.
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 Wed 20 Apr 11 14:17 
 Running a car personally v on the company - Dulwich Estate
Big but.

Make sure that the mileage is massaged and provable. Make up the records and extract as much tax free cash as possible. It can be done.
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 Wed 20 Apr 11 15:07 
 Running a car personally v on the company - Hard Cheese

>> Charging a company mileage is a very efficient way of taking money out of a
>> company tax free.
>>

That's what I used to do so will probably handle it that way.



Thanks all.

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 Wed 20 Apr 11 17:14 
 Running a car personally v on the company - Mapmaker
Or run a van through the company. A L200 twin cab, for instance.

Don't forget the other ways of extracting cash from companies tax free; childcare vouchers, 5k loan to directors, mobile phone contracts, employing the housewife wife, dividends etc. etc.
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 Wed 20 Apr 11 18:08 
 Running a car personally v on the company - rtj70
Not that I need them but I could get childcare vouchers from my employer and vouchers for shopping. And pension is taken out as salary swap so avoids NI contributions. Even more scope if self employed ;-)
Last edited by: rtj70 on Wed 20 Apr 11 at 18:08
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 Wed 20 Apr 11 18:20 
 Running a car personally v on the company - Mapmaker
>> Not that I need them but I could get childcare vouchers from my employer and
>> vouchers for shopping. And pension is taken out as salary swap so avoids NI contributions.
>> Even more scope if self employed ;-)
>>

If you're self employed then the situation is completely different.
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 Wed 20 Apr 11 18:22 
 Running a car personally v on the company - rtj70
I know that. Just saying that some of the ways the self employed can get money out tax/NI free can also apply to those of us working for an employer that we don't own.
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 Wed 20 Apr 11 18:54 
 Running a car personally v on the company - Mapmaker
You don't understand. If you're self employed there's nothing to get money out from. (Quite different from owning a company where you are employed.)
Last edited by: Mapmaker on Wed 20 Apr 11 at 18:57
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 Wed 20 Apr 11 20:31 
 Running a car personally v on the company - rtj70
You knew what I meant though - working for your own company is what I meant. Kind of self employed when many are the sole employee. With spouse as a director to get dividends out.
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