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      11-08-2009, 04:16 PM   #1
donners46
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What do you think of this deal?

Hi guys,

Just wondering what you thought of the deal I've been offered by my company car scheme. I'm a bit dubious about it but would like to know what you think.

330d Coupe M Sport with Adaptive Headlight, DAB Radio, folding mirrors with auto dimming, USB and Park Distance Control front and rear for £548.24 pm. I then also have to pay BIK which would work out at£128.06.

Now I know the scheme includes maintenance, insurance and road tax, the question is could I get this cheaper elsewhere bearing in mind I only want to keep this for 2 years (planning on going back to uni) and there is no cost to pay should I end the contract early.

Any advice would be fantastic as I need to cancel the order I've put in within 7 days!

Cheers

Don
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      11-08-2009, 04:26 PM   #2
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So nearly £675 quid a month????
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      11-08-2009, 04:27 PM   #3
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Mental money..........
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      11-08-2009, 04:34 PM   #4
donners46
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aye I thought this too, any suggestions? lease companys that offer the same for less etc?
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      11-08-2009, 05:28 PM   #5
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Huh?? If you're paying BIK tax then surely it is a company car so you're not actually paying the £550 a month rental??

If it is your company you really should be financing cars in a different way.
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      11-08-2009, 05:37 PM   #6
donners46
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Its a bank I work for car scheme, they do give you 4k a year towards this but effectively if I dont pick a car I get this at the end of the month. I know this technically means I'm only pay something like £350 of my own 'hard-earned' each month but still feel like there may be better options out there.
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      11-08-2009, 05:58 PM   #7
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So you have to contribute £200 for the car and then pay another £130 in BIK tax?

Hmm, sounds expensive.


You can get a 330d M-Sport Highline from these guys for £464 a month....

http://www.skyfleetcarleasing.co.uk/...stingID=286432

Which sounds more like it.

Friend used them for a 335d m-sport coupe and added idrive and was paying £540 a month for it doing 15k miles a year. He said he could have done it over 2 years for only £10 a month more and regretted not doing that now.
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      11-08-2009, 06:09 PM   #8
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I think i'd be the £534 option as i'd be a personal user, correct me if i'm wrong as i'm new to leasing, then i'd have to find insurance which best quote I can find at present (comparethemarket) is £1200 pa! I'm 26 and have only had a licence for 2 years, no points etc though.

That makes my work deal only slightly worse but better as excess (fingers crossed I wont need it) is £50 through work but £3k through insurance comp!!!
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      11-08-2009, 06:12 PM   #9
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Remmber any top up payment you make is tax deductable
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      11-08-2009, 06:23 PM   #10
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If a company is buying the car it can claim half the vat back, it is only personal if you buy it.

You really need to get some details from the company tomorrow I reckon.
Ask if you can have an allowance instead and see what they say.
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      11-08-2009, 09:50 PM   #11
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Its all done through Lombard. The only choices I have are 1. take the money and buy my own car or 2. use their scheme. Like I said though the fact that the longest time I'll have the car is 2 years I loathe to buy a new car as the depreciation will be massive along with the fact of having to shell out for expensive insurance, road tax, maintenance etc.
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      11-09-2009, 03:28 AM   #12
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Quote:
Originally Posted by gIzzE View Post
So you have to contribute £200 for the car and then pay another £130 in BIK tax?

Hmm, sounds expensive.


You can get a 330d M-Sport Highline from these guys for £464 a month....

http://www.skyfleetcarleasing.co.uk/...stingID=286432

Which sounds more like it.

Friend used them for a 335d m-sport coupe and added idrive and was paying £540 a month for it doing 15k miles a year. He said he could have done it over 2 years for only £10 a month more and regretted not doing that now.
Doesnt sound bad to me - you have neglected to remember as a co car, he pays no insurance, tyres, maintenance, tax..
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      11-09-2009, 06:01 AM   #13
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If that is the case, then I would go for it.

However, more and more co cars schemes are just supplying the vehicle only, that's why he needs to find out exactly what he is getting.
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      11-09-2009, 06:31 AM   #14
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Hang on though Donners has said that he gets a 4K per yr allowance, and he has to insure the vehicle.
The 4kpa will be added to his salary and taxed accordingly, he may still remain in the 22% bracket or the 4k will tip his salary over the threshold into the 40% bracket, or any other computations that may affect his exposure to tax.
Assuming the car is maintained and taxed (road) by the leasing company, who will also take the depreciation hit, it will all be about how much the car will cost him per month out of his own pocket.

4K @ 40% tax is worth £200 per month
4k @ 22% tax is worth £260 per month

So it's down to either costing him personally - £348.00 @ 40% tax (car lease is £548.00) + insurance, or £288.00 @ 22% tax + insurance.

If he gets some form of business mileage repayment this would also benefit his situation if it was a generous allowance, i.e 40ppm - first 10k mls, 25ppm over and above.
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      11-09-2009, 06:37 AM   #15
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His OP says it is insured for him.

I would imagine the £4k is an allowance instead of taking the car, so the effect of taking the car, is any contributions, plus BIK, plus net loss of 4k per year (after tax).
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      11-09-2009, 06:49 AM   #16
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Hi guys, I get 4k in each year, spread across 12 months, if I take up their car scheme then its deducted from my gross pay (which includes this car payment), insurance is included in the scheme, I get 12ppm if on the company car scheme or 40ppm if my own car (lease etc) I work locally so will only really average 6-9k miles.
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      11-09-2009, 06:53 AM   #17
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Quote:
Originally Posted by edowen View Post

His OP says it is insured for him.

I would imagine the £4k is an allowance instead of taking the car, so the effect of taking the car, is any contributions, plus BIK, plus net loss of 4k per year (after tax).
Doh! Just saw that!

Seems like a cr@p deal to me, hugely expensive and probably benefits everyone but the OP, mind you, the details posted make it hard to work it out!
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      11-09-2009, 08:37 AM   #18
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It seems to me that the company has got a cost to lease the car, maintain it and insure it which costs £548 per month. £6576 a year.

Now, from that £6576 p.a they contribute £4000, or £333 a month leaving you to fund the remaining £214 per month.

Problem is you will still be taxed on the list price of the car, you then get a deduction for the £214 you contribute each month but that deduction is only 22% of the £214, so £50, so you are still paying another £130 (approx.) a month on top to own that car.

So all in all it is costing you £344 a month.


Now, if you took the £4000 a year allowance, you would have £260 a month, plus the £130 you save on BIK tax leaving you..
£490 a month to spend on a car.
Plus you get 40p per mile instead of 12p, how many business miles do you do a years??


If it were me I would buy a nice 2006 335d sport for £19k which would cost you around £300 a month over 2 years with a balloon.
I guess it depends how many business miles you do?? If you do 10k I think going private and taking the money makes more sense, if you do 5k miles it is more a case of what you want.

Or hire one from elsewhere who are cheaper, I always use Lombard for my finance, however their contract hire rates are very high.

I was looking at a Merc E280cdi estate in the spring, got offers of £329 a month from a couple of brokers online, closest they could get was £489, a massive difference.
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      11-10-2009, 07:03 AM   #19
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There are loads of 'cash for car' calculators on the internet, which can help you out on this decision:

http://extranet.lvl.co.uk/cash4car/cfc0005.jsp

As a rough idea, your allowance is £445 per month after tax and you would save around £200 a month in company car tax.

So if you opt out you will have around £ 645 a month to play with.

Have a look here to see what that would buy on a lease purchase or PCP.

http://www.broker4cars.co.uk/

On these numbers I would say that the benefits of opting out are marginal. Effectively the £4k cash value does not reflect the grade of company car you could get. In reality your employer is getting the benefit of the tax savings if you opt out instead of you.
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