Car tax: road tax, company car tax... which one?

Hi all,

I am getting a car from my company and while researching, I found out a number of tax that I need to pay (yearly) and I want to sure that these are all the tax that I need to pay and not missed anything. I am drawing up a budget for the type of the car I want and want to make sure I won't end up paying tons of tax.

So far I found:

- Company car tax (from Honda website) - based on CO2 emission?
- Road disc tax - just heard of it, but don't know how to calculate it

Any other tax I need to pay on yearly basis?

Hi,

The only one you need worry about is company car tax. Your company must prepare a P11D form annually which calculates your tax bill. If your company pays your income tax for you (rather than completing your own tax return) ask them to deduct the tax monthly out of your pay cheque which is less painful than receiving a big annual bill.

This page is quite helpful: http://www.comcar.co.uk/

Hi Boatmad,

So in your experience,  I assume the company (or the leasing company) ALREADY paid for the road tax AND any other tax?

I checked out the website you mentioned, but I want to make sure there are no any other "surprises" for me besides the company car tax.

Im leasing a car through my firm, and they pay the road tax, and all maintenance.
I would assume its the same with a company car.

another thing to consider... private fuel benefit.  it is calculated as a seperate tax from teh company car benefit.  something else to take into consideration.

The cost of road tax, also known as the Road Fund Licence, VED (Vehicle Excise Duty), or more simply just "the tax disc," depends upon the vehicle.  Pre 2001 cars are on a simple two-level system depending upon whether the engine is over or under 1549 cc (approx. 91 cu. in.).   2001 and later it's a graduated scale based upon estimated vehicle emissions.

If for some reason you do have to pay it yourself, here are the rates:

http://www.direct.gov.uk/en/Motoring/OwningAVehicle/HowToTaxYourVehicle/DG_10012524

Hi all,

So it looks like that the tax for cars are as follow (paid monthly):

1) Company car tax -> paid by me
2) Road tax -> MAY be paid by company
3) Private fuel benefit -> I don't receive this from my company. So looks like I don't have to pay for this?

Basically, I just received a lump sum for the cost of the car and I have to purchase it from my company's Intranet. I.e can't just go to a any dealer.

so you're being given a car allowance?  you will own the car? 

there's a big difference between you being the registered keeper or your company leasing the car on your behalf....

pls check which situation your company is doing. 

you will own the car? 

And if you have to pay for your own insurance too, then technically you might need to insure for business use as well as personal.   £££££........

I will check, but I am sure I will "not" own the car. My company is a Big 4 and there are many consultants that need car due to the travel requirements. So that car is just for lease. I was told by my boss that ALL cost of servicing the car (oil change, etc.) is covered by the company.

Meggles, is that your case too or you just own the car?

there are two schemes my company has. 

1- (the one i'm on).  the company leases the car.  they pay for insurance, road tax, emergency service cover, all maintance, all car washings.  they also pay for private fuel benefit.  basically, a percentage of the list price of the car is added to my salary.  this is then subject to my rate of tax.  the percentage is based on the carbon emissions & type of fuel.  i have a toyoto prius, hybrid electric, and my carbon is 104g.  one of the lowest.  therefore, 11% of the list price is added to my salary.  i also get private fuel beneift.  again a percentage of the list price is added to my salary.  if you go to the inland revenue site, you can find a short pdf that explains this.  you can work out what car you want, and the differences in the amount of tax you'll pay.

2- some people want their own car.  they get a set monthly car allowance.  they also get reimbursed for petrol.  they keep track of their work mileage, and they multiply by a set amount to figure out how much they shoudl be reinbursed for fuel.

To calculate private fuel benefit the percentage is applied to a standard amount, not the list price, £14,400 I believe.  Just a minor irrelevant point.

1- (the one i'm on).  the company leases the car.  they pay for insurance, road tax, emergency service cover, all maintance, all car washings.  they also pay for private fuel benefit.  i have a toyoto prius, hybrid electric, and my carbon is 104g.  one of the lowest.  therefore, 11% of the list price is added to my salary. 

Thanks, Meggles. This is exactly what I have, although I am checking with them on whether the insurance cost is included.

If you don't mind me asking, how much do you pay for the Prius on a monthly basis (just the price of the car) including insurance?

I have 2 options of getting the car:

1) Order through my company
2) Take the car allowance as cash (subject to tax) and then do the contract hire purchase myself, such as from (http://www.lingscars.com/)

So if Masterlease (the leasing company that my employer contracted) gave higher quote, I may just go out and do it myself.

my company handles the leasing, insurance, MOT, road tax, etc.. i don't see any of these costs.  we have a monthly limit of £500, so it must be under that.

http://www.m-v-m.com/

i used this ages ago to double check that a prisus was under that £500 threshold. 

if you're given a car allowance- then i would assume that that would be added to your salary and subject to tax.  however, i have never been in that situation.