Company Pool Car Rules

Discussion in 'UK Accountancy' started by Abacus, Sep 27, 2005.

  1. Abacus

    Abacus Guest

    Hello,

    I know the Revenue like to bash company pool cars and I hope someone can
    offer some advice.

    I have a small business and there are three of us (1 director and 2
    employees) who are "on the road" a lot. We each have our own private cars
    and currently use them and charge mileage to the company. We want, instead,
    to buy a company pool car which would be owned by the company and insured by
    the company. We would each keep our own private cars too.

    If we had a company pool car, one of use MUST take it home each evening as
    there is no where to park overnight near our office (we use a multi-storey
    during the day which is unsafe overnight (usual vandals etc).

    Is it possible for the company to own this pool vehicle and for none of us
    to be hit with personal use charges by the Inland Revenue? Do we need to do
    anything in particular to ensure the vehicle is maintained as a pool vehicle
    and is there anything, in particular, that needs to be done to ensure none
    of us get hit with a private use charge?

    Thanks

    Ian
     
    Abacus, Sep 27, 2005
    #1
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  2. Abacus

    DoobieDo Guest

    In article <dhb0m7$7k9$-infra.bt.com>,
    says...
    > Hello,
    >
    > I know the Revenue like to bash company pool cars and I hope someone can
    > offer some advice.
    >
    > I have a small business and there are three of us (1 director and 2
    > employees) who are "on the road" a lot. We each have our own private cars
    > and currently use them and charge mileage to the company. We want, instead,
    > to buy a company pool car which would be owned by the company and insured by
    > the company. We would each keep our own private cars too.
    >
    > If we had a company pool car, one of use MUST take it home each evening as
    > there is no where to park overnight near our office (we use a multi-storey
    > during the day which is unsafe overnight (usual vandals etc).
    >
    > Is it possible for the company to own this pool vehicle and for none of us
    > to be hit with personal use charges by the Inland Revenue? Do we need to do
    > anything in particular to ensure the vehicle is maintained as a pool vehicle
    > and is there anything, in particular, that needs to be done to ensure none
    > of us get hit with a private use charge?
    >
    > Thanks
    >
    > Ian
    >
    >
    >

    a sign-written van ?
     
    DoobieDo, Sep 27, 2005
    #2
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  3. Abacus

    Abacus Guest


    > a sign-written van ?


    From what I understand, a sign-written van would not avoid personal
    benefits.

    The question another way would be...

    How do we prevent the Revenue raising a personal use charge against an
    employee who has been told he must take a company pool car home (principally
    for security) without that employee being hit with a tax adjustment as he
    neither wants nor has requested a company vehicle? (It may be a different
    employee on different days)

    This is a genuine situation and not just a means to avoid tax. The tax
    payers charter states that the Revenue have a duty to charge "the right
    amount of tax". If the vehicle is a true pool vehicle then the right amount
    of tax should be zero. How can we safeguard that position ?

    Thanks

    Ian
     
    Abacus, Sep 27, 2005
    #3
  4. Abacus

    Peter Saxton Guest

    On Tue, 27 Sep 2005 10:50:37 +0000 (UTC), "Abacus"
    <> wrote:

    >
    >> a sign-written van ?

    >
    >From what I understand, a sign-written van would not avoid personal
    >benefits.
    >
    >The question another way would be...
    >
    >How do we prevent the Revenue raising a personal use charge against an
    >employee who has been told he must take a company pool car home (principally
    >for security) without that employee being hit with a tax adjustment as he
    >neither wants nor has requested a company vehicle? (It may be a different
    >employee on different days)
    >
    >This is a genuine situation and not just a means to avoid tax. The tax
    >payers charter states that the Revenue have a duty to charge "the right
    >amount of tax". If the vehicle is a true pool vehicle then the right amount
    >of tax should be zero. How can we safeguard that position ?
    >
    >Thanks
    >
    >Ian
    >

    Find a secure place to park the "pool car" that doesn't involve the it
    being driven to the employees home.

    --
    Peter Saxton from London
     
    Peter Saxton, Sep 27, 2005
    #4
  5. Abacus

    Mike Lewis Guest

    "Abacus" <> wrote in message
    news:dhb85s$b0c$-infra.bt.com...
    >
    > > a sign-written van ?

    >
    > From what I understand, a sign-written van would not avoid personal
    > benefits.
    >
    > The question another way would be...
    >
    > How do we prevent the Revenue raising a personal use charge against an
    > employee who has been told he must take a company pool car home

    (principally
    > for security) without that employee being hit with a tax adjustment as he
    > neither wants nor has requested a company vehicle? (It may be a different
    > employee on different days)


    You don't unless the nights it is taekn home are very rare. Security of the
    vehicle is irrelevant.

    > This is a genuine situation and not just a means to avoid tax. The tax
    > payers charter states that the Revenue have a duty to charge "the right
    > amount of tax". If the vehicle is a true pool vehicle then the right

    amount
    > of tax should be zero. How can we safeguard that position ?


    What you describe isn't a pool vehicle.

    --
    Mike Lewis
    Chartered Accountant
    www.mikelewis.co.uk
     
    Mike Lewis, Sep 28, 2005
    #5
  6. The first Problem is that the tax rules bite if the car is available for
    private use (i.e no actual private use is necessary)

    The problem is usually the easiest to get around. You simply state to all
    employees as part of their use of the vehicle that there can be no private
    use and make it a written condition for use of the car.

    Your next problem is that 'taking the car home' is by definition Private
    use. ( The revenue define it as commuting)

    To get around this problem you need to get a written dispensation from HMIT.
    Basically you need to outline the situation as given, give them a copy of
    the written conditions of use of the vehicle and get them to agree that
    there is no PAYE charge.

    To avoid undue costs I would get a general clearance before you purchase the
    vehicle. Beware however that the revenue can vary these dispensations at a
    whim. ( Although they try to avoid this)

    Russell


    "Abacus" <> wrote in message
    news:dhb0m7$7k9$-infra.bt.com...
    > Hello,
    >
    > I know the Revenue like to bash company pool cars and I hope someone can
    > offer some advice.
    >
    > I have a small business and there are three of us (1 director and 2
    > employees) who are "on the road" a lot. We each have our own private cars
    > and currently use them and charge mileage to the company. We want,

    instead,
    > to buy a company pool car which would be owned by the company and insured

    by
    > the company. We would each keep our own private cars too.
    >
    > If we had a company pool car, one of use MUST take it home each evening as
    > there is no where to park overnight near our office (we use a multi-storey
    > during the day which is unsafe overnight (usual vandals etc).
    >
    > Is it possible for the company to own this pool vehicle and for none of us
    > to be hit with personal use charges by the Inland Revenue? Do we need to

    do
    > anything in particular to ensure the vehicle is maintained as a pool

    vehicle
    > and is there anything, in particular, that needs to be done to ensure none
    > of us get hit with a private use charge?
    >
    > Thanks
    >
    > Ian
    >
    >
     
    Russell Lewis, Sep 28, 2005
    #6
  7. just get a van and pay the benfits

    you can not get away with a car if you take it home, unless its parked at
    the premises and no one takes it home.

    the inspector will actually drive around the directors home, before an
    inspection, to check whether anyone takes the car/van home.


    "Abacus" <> wrote in message
    news:dhb85s$b0c$-infra.bt.com...
    >
    > > a sign-written van ?

    >
    > From what I understand, a sign-written van would not avoid personal
    > benefits.
    >
    > The question another way would be...
    >
    > How do we prevent the Revenue raising a personal use charge against an
    > employee who has been told he must take a company pool car home

    (principally
    > for security) without that employee being hit with a tax adjustment as he
    > neither wants nor has requested a company vehicle? (It may be a different
    > employee on different days)
    >
    > This is a genuine situation and not just a means to avoid tax. The tax
    > payers charter states that the Revenue have a duty to charge "the right
    > amount of tax". If the vehicle is a true pool vehicle then the right

    amount
    > of tax should be zero. How can we safeguard that position ?
    >
    > Thanks
    >
    > Ian
    >
    >
     
    Newsgroup User, Sep 30, 2005
    #7
  8. Abacus

    Simon Guest

    "Newsgroup User" <> wrote in message
    news:dhk7qq$8s1$-infra.bt.com...
    > just get a van and pay the benfits
    >
    > you can not get away with a car if you take it home, unless its parked at
    > the premises and no one takes it home.
    >
    > the inspector will actually drive around the directors home, before an
    > inspection, to check whether anyone takes the car/van home.
    >
    >



    Not as a matter of course he wouldn't. That's directed surveillance and it
    requires authority from a designated officer and detailed records are kept.
    These are vetted by an outside authority and HMRC would be severely
    criticised for doing so without just cause.
     
    Simon, Oct 1, 2005
    #8
  9. Abacus

    Fred Guest

    "Abacus" <> wrote in message
    news:dhb85s$b0c$-infra.bt.com...
    >
    >> a sign-written van ?

    >
    > From what I understand, a sign-written van would not avoid personal
    > benefits.
    >


    I thought IR had changed it's rules regarding vans and commuting to and from
    work. It's not regarded as a taxable benefit any more. In 2007 Gordon
    Brown is going to heavily tax commercial vehicles which are used for
    personal use over and above commuting to work. Am I wrong?

    I also thought it was allowable for a "pool" car to be taken home as part of
    a journey the next day.

    This all begs the question how the employee gets the car home without
    leaving his at work?
     
    Fred, Oct 2, 2005
    #9
  10. Abacus

    Peter Saxton Guest

    On Sun, 2 Oct 2005 10:33:09 +0100, "Fred" <0m> wrote:

    >
    >"Abacus" <> wrote in message
    >news:dhb85s$b0c$-infra.bt.com...
    >>
    >>> a sign-written van ?

    >>
    >> From what I understand, a sign-written van would not avoid personal
    >> benefits.
    >>

    >
    >I thought IR had changed it's rules regarding vans and commuting to and from
    >work. It's not regarded as a taxable benefit any more. In 2007 Gordon
    >Brown is going to heavily tax commercial vehicles which are used for
    >personal use over and above commuting to work. Am I wrong?
    >
    >I also thought it was allowable for a "pool" car to be taken home as part of
    >a journey the next day.
    >
    >This all begs the question how the employee gets the car home without
    >leaving his at work?
    >

    If it's a pool car shouldn't the employee travel to work to collect
    it?

    --
    Peter Saxton from London
     
    Peter Saxton, Oct 2, 2005
    #10
  11. Abacus

    Simon Guest

    "Peter Saxton" <> wrote in message
    news:...
    > On Sun, 2 Oct 2005 10:33:09 +0100, "Fred" <0m> wrote:
    >
    >>
    >>"Abacus" <> wrote in message
    >>news:dhb85s$b0c$-infra.bt.com...
    >>>
    >>>> a sign-written van ?
    >>>
    >>> From what I understand, a sign-written van would not avoid personal
    >>> benefits.
    >>>

    >>
    >>I thought IR had changed it's rules regarding vans and commuting to and
    >>from
    >>work. It's not regarded as a taxable benefit any more. In 2007 Gordon
    >>Brown is going to heavily tax commercial vehicles which are used for
    >>personal use over and above commuting to work. Am I wrong?
    >>
    >>I also thought it was allowable for a "pool" car to be taken home as part
    >>of
    >>a journey the next day.
    >>
    >>This all begs the question how the employee gets the car home without
    >>leaving his at work?
    >>

    > If it's a pool car shouldn't the employee travel to work to collect
    > it?
    >
    > --
    > Peter Saxton from London
    >


    Its true Peter, if a worker is going to make an early start to a journey
    then taking the car home the evening before would usually be considered as
    part of the journey. Mind you, if a worker took the car home for 20 or so
    Journeys a month I might get a tad suspicious.

    Simon
     
    Simon, Oct 2, 2005
    #11
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