Company Car (Electric) bought using personal PCP

[OrchUK]

Wondering if anyone has been in a similar position and can shed any light please.

I have a newly setup Ltd company, and the am in the process of trying to organise myself a company car (100% electric).

Because the company is new and has no accounts to show, the dealer just presented me with PCP paperwork in my personal name: they hadn’t said they were going to do that. That’s obviously got the finance approved from their end.

Can I still declare it as a company car and make all payments from the company and declare all relevant BIK payments etc. or is it a big problem that the paperwork doesn’t have the company name on?

 

[DWS]

If you want it to be a Company car then it needs to be in the Companies name, whether that is a good idea or not is something you should discuss with your accountant.

 

[Argentum Tax]

I agree with DWS. To be a ‘company car’, with all that entails, the vehicle needs to be actually owned by the company and the finance etc contract must be in the company’s name. Also I would recommend you take proper advice on whether that would be the best way forward.

 

[scstock]

If you're going to be doing a reasonable amount of business mileage then you may be better off anyway running it as a personal car and claiming back mileage from your company at 45p per mile for the first 10,000 business miles in the financial year, and 25p per mile thereafter - this is not subject to tax.

 

[OrchUK]

Thanks for the replies - with the current BIK rates for Electric cars it does seem worth it. My only obstacle is the new company having no credit history. Does anyone know if Car Finance companies would let you act as a guarantor personally to allow the company to but the car? (I know my credit score is good enough as they already approved the finance under my personal name without asking me!)

 

[Mark T Jones]

Thanks for the replies - with the current BIK rates for Electric cars it does seem worth it. My only obstacle is the new company having no credit history. Does anyone know if Car Finance companies would let you act as a guarantor personally to allow the company to but the car? (I know my credit score is good enough as they already approved the finance under my personal name without asking me!)

They very likely will. Are you a home owner?

I belive @Gordon - Commercial Finance know about car finance

 

[Gordon - Commercial Finance]

Thanks for the replies - with the current BIK rates for Electric cars it does seem worth it. My only obstacle is the new company having no credit history. Does anyone know if Car Finance companies would let you act as a guarantor personally to allow the company to but the car? (I know my credit score is good enough as they already approved the finance under my personal name without asking me!)

Yes you absolutely can be a personal guarantor in your company’s car agreement. Most likely with a newer business it will be required anyway.

Your accountant would be best placed to determine whether it’s better for you to have personal car or company car - there’s a lot of elements to that particular question.

What I can say, is that PCP is not a good product, and I would always recommend getting out of it if you can and getting it on HP. Depending on where you are in your PCP agreement you may be able to do something like a refinance to bring it in to the company and on HP.

 

[Financial-Modeller]

If you're going to be doing a reasonable amount of business mileage then you may be better off anyway running it as a personal car and claiming back mileage from your company at 45p per mile for the first 10,000 business miles in the financial year, and 25p per mile thereafter - this is not subject to tax.

Are those rates applicable to an EV?

I'm happy to be corrected, but recall its 4p per mile or similar?

 

[Bobbo]

Are those rates applicable to an EV?

I'm happy to be corrected, but recall its 4p per mile or similar?

45p is for business miles in a personal EV.
4p is for business miles in a company EV.