At present, although one can crunch the numbers, and occasionally it's worth doing so, advising on whether a company owner-director should get their car via their company or not is generally a pretty straightforward big picture process:
- Is it a new petrol/diesel car? Probably not a good idea; you're unlikely to lose out materially by just getting it yourself, you might lose out materially by putting it through the company.
- Is it a used petrol/diesel car? Virtually certain to be a terrible idea to get it through the company.
- Is it an electric car or a hybrid? Probably not much in it, you'll be fine either way.
If you then do the maths, you're 95% likely to find that's how it turned out. It's rare for the tax payable by the driver on the "Benefit in Kind" value of the car to merit the tax relief that the company will get on the costs.
From next year, it becomes a bit more interesting. The first two points stand. Over the last few years, nobody ever really lost out by owning their traditional car personally, but plenty lost out by having a used car as a company car. The big change is with 100% electric cars. For those, the Benefit in Kind value doesn't just decrease dramatically, it vanishes. The driver will pay no tax at all for the privilege of using the car. So a 100% electric car via a company suddenly becomes very compelling in many cases. In 2021 and 2022 the Benefit in Kind rate will rise again - but only to 1% and then 2% of the list price of the car. In practical terms, still virtually nothing.
Of course, maybe once electric cars are very widespread the tax regime will become less generous again. But for the time being, you can expect a big spike in the proportion of electric cars sold to companies rather than their owner.
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