Quote:
Originally Posted by gIzzE
Sort of shows what a joke BIK tax is on cars, when a car can cost £400 a month and the government think it is fine to charge someone nearly £900 for that car!!!
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Takes the piss, doesn't it.
At the very worst case, the BIK should be the tax difference between what a business pays (in this case, £399) and what a private individual would need to earn (gross) to pay the tax on that theoretical allowance, plus the VAT.
So, in terms of conversational numbers; the business pays £400.
A private individual pays £480 (£400 + the Vodka and Tonic). In order to nett £480 a 40% tax payer would need to earn circa £800. Therefore a fair BIK should to pay tax on the £400 benefit (difference between cost to business and cost to indivdual) one is receiving (i.e. £160)