Is 48mo Agility 'better' than 36mo?

[edstrom76]

http://www.fleetprices.co.uk/busine...a-class-hatchback/a45-4matic-5dr-auto-8744437

£17,343 + VAT over 36 months - it's actually less than I quoted earlier. And if I'm not mistaken you can claim 1/2 the VAT back as a business user?

 

[regbuser]

@dryce

the OP stated they were running their own business, hence my reasoning that they, or other contributors would welcome income efficient ways of running business vehicles; that does not appear to be the case.

if people would rather be enmired in paying for their vehicles post-taxation (PAYE & VAT) and parting with even more in benefit in kind on their national insurance contributions, well it's a free world..


@edstrom

100% VAT reclaimable for exclusive business use

50% reclaimable where it's part of a company car scheme

 

[Dryce]

if people would rather be enmired in paying for their vehicles post-taxation (PAYE & VAT) and parting with even more in benefit in kind on their national insurance contributions, well it's a free world..

That's not the point.

The directors of the company I work for don't have company cars.

They no doubt have worked the same rough calculation that I suggested to you. Thirty years ago a company car was indeed a no-brainer. However it was noticeable even back in the mid-nineties that there was a move away from them by directors who were finding that claining back mileage on a personal car was just as effective *in some circumstances*.

The reason the decision has to be undertaken carefully is the large discrepancy between private contract hire costs and BIK on higher value cars.

 

[Red C220]

@dryce

the OP stated they were running their own business, hence my reasoning that they, or other contributors would welcome income efficient ways of running business vehicles; that does not appear to be the case.

if people would rather be enmired in paying for their vehicles post-taxation (PAYE & VAT) and parting with even more in benefit in kind on their national insurance contributions, well it's a free world..


@edstrom

100% VAT reclaimable for exclusive business use

50% reclaimable where it's part of a company car scheme

Your description of the tax situation only applies to "pool cars". i.e a vehicle that is for the sole use of company employees which is kept at the business premises, used and returned to the business premises only.

At no point is any employee meant to use to vehicle for anything other than business mileage. This also excludes commuting.

HMRC are very hot on this, to a degree that's it up to you to demonstrate the vehicle is a Pool vehicle rather than them demonstrating it's not.

The long and short of it is, the car will never be allowed to be present at your own home if you don't wish to pay any BIK.

 

[petercooper]

Been enjoying the discussion, thanks everyone! Thought I'd add some extra details though as someone was speculating whether I might want the car for business.

Answer is.. no. I do perhaps 500 business miles a year and I don't even bother expensing them for the effort. I did look into having the company buy or lease, however, and it didn't seem to work out, especially as my use is 96% personal.

For the A45, it worked out at £2210/£4420 Company Car Tax (depending on tax bracket) but then on top of that are the NICs the company has to pay.. and the sums basically started to look bad. And then there's the risk of having the tax man sniffing around, etc, even if it's 100% legitimately done. The other issue is another 4K or so of extras.. some leasing companies are crap at dealing with this properly and it bumps up the rates a bit more of course.

That said, I agree with some commenters that business leases can make a ton of sense in the right situations, so I'm sure other people who come to this thread will get some value out of it!

 

[regbuser]

@ Red - that is correct, although it is not unusual for a small business to be registered and trading from the director's residential address

@ Op - you're welcome

 

[Red C220]

@ Red - that is correct, although it is not unusual for a small business to be registered and trading from the director's residential address

I'm a director of a Limited company I run from home.

HMRC would not accept a "pool car" in this situation. It was abused so much in the past it's very difficult/impossible to run this past them now.

For the last 5 years I've run every car I've bought privately as it was financially more efficient to do so.

There was a time when business leases were not available to general members of the public. Then it made sense to lease the car through the company and personally pay the money back in to the business to benefit from the reduced rate.

Every other situation than that creates BIK tax these days.

 

[Dryce]

The other issue is another 4K or so of extras.. some leasing companies are crap at dealing with this properly and it bumps up the rates a bit more of course.

It's not the leasing companies that are crap at dealing with options - it's the manufacturers that use them to disproportionately leverage their margins.

Options are horrendously overpriced. The extra £2K+ for better looking alloys is really only worth £500. That £2K satnav and media system upgrade is really only worth £250. The heated seats at £350 only £50 - and so on.

 

[Dryce]

HMRC would not accept a "pool car" in this situation. It was abused so much in the past it's very difficult/impossible to run this past them now.

The few people I know who have done this keep a detailed log of the vehicle usage and client sites travelled to - and make sure that this can be cross referenced with client timesheets and invoices.

 

[flowrider]

When I bought my ML on a 48 month Agility PCP I was told that I would be able to return the vehicle without making any further payments after 30 months. I was told that the criteria was that I needed to have paid 50% of the total amount payable in the contract. This is regulated by the Consumer Credit Act.