Why would I provide a company car?
What do I need to think about?
Hi, today we’re looking at the next of our 52 top tips for employers, and it’s the five of spades, and it’s all about company cars.
So the company car can be an expensive benefit and the tax implications must be considered. If you’re providing a cash allowance, then this is automatically taxed at the employee’s normal taxable rate. However, if you’re providing a company car, it is still a taxable benefit and the amount of tax is determined by the company mileage, the type of car, the CO2 emissions, as well as the employee’s taxable rate.
A comprehensive car policy should be developed to ensure that it’s adequate to protect all of the company’s assets, and so that your staff understand what they’re entitled to, what they need to pay for, and what you as their employer pay for.