Any tax benefits?

[Dazdot]

I am MD and shareholder of the company.

I am looking to lease a new car and wondering if there are any benefits with the following for me/the company. Or are there are any other ways of getting tax benefits from leasing a new car.

Company lease a car for say £750 + vat.
I pay £750 lease cost to company. Can company claim vat back so I dont have to pay vat to company? I assume I will be taxed on vat amount as it's classed as a benefit?
I pay for running and maintenance costs and claim mileage from company.

Or:

Company lease a car for say £750 + vat.
I pay £750 + vat lease cost to company.
I pay for running and maintenance costs and claim mileage from company.

Is there any benefit to this, over me having a personal lease hire and charging mileage?

Thanks in advance.

 

[Adam93]

If it is a company lease, then you will be subject to the benefit in kind rules even if you repay the lease amount to the company (this repayment to the company will be deducted from the benefit-in-kind-value).

It depends on what type of car you get. If it is a 4 litre diesel or a fully electric car, the answers will differ greatly.

As for reclaiming VAT, there are special rules when it comes to cars.

To be honest, if you are spending £750 a month on a car, you should get an accountant before you get yourself into a mess.

 

[Dazdot]

If it is a company lease, then you will be subject to the benefit in kind rules even if you repay the lease amount to the company (this repayment to the company will be deducted from the benefit-in-kind-value).

It depends on what type of car you get. If it is a 4 litre diesel or a fully electric car, the answers will differ greatly.

As for reclaiming VAT, there are special rules when it comes to cars.

To be honest, if you are spending £750 a month on a car, you should get an accountant before you get yourself into a mess.

Adam, thanks for your reply. First port of call will be our in house financial controller and then our company accountant. As I only came up with the thought tonight (whilst out walking the dog) I thought I would see if there were any definite answers online. The car would be a Tesla model 3, long range. A personal lease would cost me nothing over three years as the mileage allowance I am paid would cover the lease along with the charger install and the charging, just wondered if there were any further benefits for me and/or the company.

Regards.

 

[SteveHa]

from April 2020 the taxation position will be significantly better than it will before April 2020. ULEDs (and all electric with good range in particular) will incur only a minimal benefit in kind (2% of list price when new), whilst garnering full CT relief on the lease.

The VAT position is more difficult without full information (and in particular, the prospect of the company meeting your VAT liability on its' supply to you), and would be better answered by your accountant who will have full information.

 

[Dazdot]

from April 2020 the taxation position will be significantly better than it will before April 2020. ULEDs (and all electric with good range in particular) will incur only a minimal benefit in kind (2% of list price when new), whilst garnering full CT relief on the lease.

The VAT position is more difficult without full information (and in particular, the prospect of the company meeting your VAT liability on its' supply to you), and would be better answered by your accountant who will have full information.

Much appreciated.