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Car allowance v BIK

  • 23-12-2013 8:58pm
    #1
    Harry321
    Registered Users, Registered Users 2 Posts: 56 ✭✭


    Folks

    I am after being told that I have to leave company car scheme when lease is up on 3rd Feb. I am a bit stomached about it as I was happy with the way things were

    Anyway they are offering me €700 month plus I can expense the fuel for company business miles

    The BIK I am paying isapprox €280/month after tax. Coincidentally I just sold my private car for €4.5k last week and I was treating this as an upside but now I have to use it to invest in a car and thus I feel out of pocket straight away

    What is my best option

    Buy a decent 2nd hand car for 10 or12k or buy a brand new car on a car finance program which would cost me circa €475/month?


    Some advice please as I need to get this sorted in Jan


Comments

  • #2
    Alan Shore
    Registered Users, Registered Users 2 Posts: 735 ✭✭✭Alan Shore


    Bit confused by your post. But here goes.

    You will be up €280 as you won't have any BIK on the company car.

    They are offering you €700 per month plus mileage so approx €350 after tax if you are a higher rate taxpayer. So you will be up €630 overall so you will have this extra to cover your new lease, insurance, motor tax and private fuel. The mileage will cover business fuel and contribute to the other expenses.

    Hope that helps.


  • #3
    Harry321
    Registered Users, Registered Users 2 Posts: 56 ✭✭Harry321


    Alan, thank you

    In theory it is not mileage, I will expense the fuel on the company credit card and I will not get a flat rate per mile

    Are you suggesting enter a car finance program as opposed to front loading €10 to€12k on a 2nd hand car?


  • #4
    Harry321
    Registered Users, Registered Users 2 Posts: 56 ✭✭Harry321


    Folks , does anyone else have an opinion/advice on this ?


  • #5
    Harry321
    Registered Users, Registered Users 2 Posts: 56 ✭✭Harry321


    Folks

    To buy a equivalent car to company car I have now, would cost €500/month finance. If I add that yo all other costs exclusive of fuel,it is working out @ €750/month. This includes depreciation.

    If I include the cost of finance plus cost of depreciation, am I to an extent double accounting?

    Would be grateful for perspectives on this


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