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Company Car or own car

  • 20-10-2011 7:06am
    #1
    Galdonagh
    Registered Users, Registered Users 2 Posts: 22 ✭


    Hi all,

    would you advise a director of a company who wants to change their car to buy a car themselves and claim travel tax free from company or for company to buy the car and the director to pay BIK on the car? Both can afford to buy the car.

    Thanks
    Galdonagh


Comments

  • #2
    nompere
    Registered Users, Registered Users 2 Posts: 1,678 ✭✭✭nompere


    Every case is different, and requires some number-crunching.

    A good general rule is that any employee (including a director) who does a high mileage will be better off owning his own car and charging a rate to the employer. The converse -- that an employee who does a very small mileage will do better by having a company car and paying the bik -- is also true.

    This is because mileage rates (set as they are by the civil service) are on the generous side, and benefits in kind are not (yet?) taxed at the full economic cost.

    Finding the break-even point is not always easy.


  • #3
    Galdonagh
    Registered Users, Registered Users 2 Posts: 22 ✭Galdonagh


    Thanks for your reply. Very informtive.


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