Company car BIK charges by employer

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First off thanks for taking the time to read and hipefully provide an answer 

 

I understand how company car works that you have to pay tax and howntheybwork out BIK for personal use. However all i can find is that the employer normally should pay for servicing , parts, mot etc

We have no agreement from the employer on what needs to be paid for. So previous charges that we have been told are taxable as BIK due to the personal use are tyres, windscreen repair/replacement, brake pads etc

Is this right or should it be the employer that pays for this?

Replies (15)

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By Ruddles
18th Jan 2024 21:18

Cowboy54 wrote:
We have no agreement from the employer on what needs to be paid for.

I suggest that you ask for one then.

Thanks (3)
DougScott
By Dougscott
19th Jan 2024 00:01

The car belongs to the employer not you and the employer should pay for all running costs. That is why you are paying a BIK tax charge.

Thanks (1)
Replying to Dougscott:
By Ruddles
19th Jan 2024 09:05

Whether or not the employer should meet those costs is entirely a matter for agreement between employer and employee. Personally, I agree that I would be somewhat aggrieved if I were having to pay for something that I was effectively being taxed on, but there is no authority (as far as I am aware) that forces the employer to meet the costs.

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Replying to Ruddles:
DougScott
By Dougscott
19th Jan 2024 11:05

Ruddles wrote:

Whether or not the employer should meet those costs is entirely a matter for agreement between employer and employee. Personally, I agree that I would be somewhat aggrieved if I were having to pay for something that I was effectively being taxed on, but there is no authority (as far as I am aware) that forces the employer to meet the costs.

You are probably correct. Of course the BIK is for the provision of the car, not the running costs. However if the OP is having to pay for running costs then he should be able to claim a mileage allowance for any business miles travelled. Presumably the company has other employees so he could ask them what the company policy is.

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By SXGuy
19th Jan 2024 08:08

Ask your employer how they intend to remove, brakes, pads, windows and fit company ones when it's not being used personally.

Thanks (1)
Replying to SXGuy:
RLI
By lionofludesch
19th Jan 2024 11:07

SXGuy wrote:

Ask your employer how they intend to remove, brakes, pads, windows and fit company ones when it's not being used personally.

[chuckle]

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RLI
By lionofludesch
19th Jan 2024 11:07

Mate - are you the employee here?

The BIK is an HMRC charge representing your private use. If you pay for anything related to that car (other than fuel, which has separate rules), the taxable BIK should be reduced pound for pound by whatever you pay.

That said, nothing to prevent the employer charging you money but it certainly wouldn't enhance my relationship with my employer.

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By Cowboy54
19th Jan 2024 11:38

Yes im an employee, we pay an agreed per mile payment. However the employer has been saying that as tyre and brake wear etc happens during personal mileage we must contribute towards this as could be seen as another BIK.
Nothing written down and all I could find as most have stated the BIK should only be for the personal use and employer covers wear&tear parts as its their vehicle

Thanks (0)
Replying to Cowboy54:
By Duggimon
19th Jan 2024 11:42

The employer paying for the wear and tear on the car would not give rise to an additional BIK charge.

If you pay for the repairs yourself that is a further contribution made by you which would lower the BIK on which you are taxed, as your per mile contribution does.

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Replying to Duggimon:
By Ruddles
19th Jan 2024 11:50

Under what provision would payment for repairs etc reduce the taxable BIK?

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Replying to Cowboy54:
RLI
By lionofludesch
19th Jan 2024 11:43

And does this agreed payment per mile come off your bik?

Sounds like you're being sold a line.

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Replying to Cowboy54:
By Ruddles
19th Jan 2024 11:48

Cowboy54 wrote:
However the employer has been saying that as tyre and brake wear etc happens during personal mileage we must contribute towards this as could be seen as another BIK.

That is utter nonsense.

And why are you paying a mileage payment (I assume in respect of private mileage) AND having to pay for wear and tear etc?

At the end of the day, the employer makes the rules and complaining about them may or may not do any good. All that people here will be able to tell you is what 'normally' happens. Whether or not you can persuade your employer to follow normal practice is up to you and them.

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Replying to Ruddles:
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By Cowboy54
19th Jan 2024 12:11

Thanks all

The mileage payment is per mile for private fuel usage as they provide a fuel card to fill up with.

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Replying to Cowboy54:
RLI
By lionofludesch
19th Jan 2024 12:38

Cowboy54 wrote:

Thanks all

The mileage payment is per mile for private fuel usage as they provide a fuel card to fill up with.

Ah right. Fuel's a separate benefit. Nothing to do with this.

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Replying to lionofludesch:
DougScott
By Dougscott
19th Jan 2024 12:53

lionofludesch wrote:

Cowboy54 wrote:

Thanks all

The mileage payment is per mile for private fuel usage as they provide a fuel card to fill up with.

Ah right. Fuel's a separate benefit. Nothing to do with this.

There is a seperate BIK for fuel but if you pay all of your private fuel usage then you won't be charged that particular BIK. You will still be charged the BIK on the capital (new P11D value) cost of the car.

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