Does your teenager need a car ?

Taxing Stuff

Does your teenager need a car ?05 Jun

Your teenage son/daughter is home from College/University and use your services as a taxi constantly. They have a full licence, why not get your company to buy/lease a car for them !

new-car

Your company could buy/lease the car and pay all of the running costs, which it can claim against its profits for Corporation Tax purposes. The company can also pay for the insurance for you ( with an extension to the policy covering family)

To qualify for Corporation Tax deduction, the car will need to be provided as part of your remuneration package. There will be no tax for you to pay on the costs, instead you will be liable to a car benefit charge.

EG. The company buys/leases a Ford Fiesta – Cost £8036 – Petrol – cc 1242 – Co2 128g

Car Benefit £8036 x 15% = £1205.40

Tax Liability

Basic Rate Payer £241.00 per annum
Higher Rate Payer £482.00 per annum

In a nutshell your son/daughter has the full use of a car at a cost to you personally of £482.00 (maximum) per year. It’s a win win situation, they get a car and their freedom and you can hang up your “Taxi” badge.

3 Responses to “Does your teenager need a car ?”

Simon Morton (June 5th, 2009 at 1:01 pm)

I told my daughter about this and she had a big smile on her face.. Then I told her it would be a smart car and her face dropped :)
Nick (June 8th, 2009 at 10:40 pm)

What a brilliant bit of advice. I’d be very interested in knowing more about business allowances for travel and hotels too. Thanks for the info, i’ll buzz you for details nearer the time on the car.
modified car club (July 1st, 2009 at 9:19 pm)

” Then I told her it would be a smart car and her face dropped :)”

why the smart car is a great car simon

Is there a limit on fuel expence on this method ?

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