Fleet managers don’t need me or anyone else to tell them that company car schemes have been firmly in HMRC’s crosshairs over the last few years. But it was still a painful reminder to see the other day that by the time the Beijing Olympics come round in 2022, the benefit-in-kind tax bill for a typical vehicle will have shot up by about 130% since 2013/14.
Had there been a mirror nearby as I read that stat I’d imagine the face looking back at me wouldn’t have been a million miles away from the sort of expression made by Killing Eve arch baddie Villanelle shortly before a bad thing is about to happen.
Is a company car scheme for you?
Not surprisingly, at Whittle Hall we’re hearing from an increasing number of businesses that are (a) questioning whether company car schemes are still for them, and (b) exploring company car allowances or mileage allowances.
If your thinking is along similar lines, we’d love to hear from you, and help talk through the options (no cost and no strings, as always). If your business only has a few employees the tax implications may mean it’s not efficient to run a scheme. That said, benefits to company car schemes remain…
One, they remain a sure-fire way to make your staff feel valued and give them an extra perk on top of their pay packet. Yes, other options give employees more flexibility, but they also give the inconvenience of insurance, tax and servicing.
And for businesses on a recruitment drive, there’s no doubt that the company car incentive is still an eye-catcher. We’ve heard stories of new starters being happy to take considerably lesser salaries in exchange for the right car.
Taking control and staying safe
Second, schemes give businesses control over the vehicles provided. Grey fleets that allow employees to use whatever car they like for work can lead to image problems: what do you do when your staff, representing the company, are driving vehicles that don’t paint the business in the best light?
Third is safety. The law is clear – an organisation has a legal duty of care to an employee, regardless of vehicle ownership. As the Energy Saving Trust states: “Grey fleet vehicles tend to be older than company cars and are likely therefore to be fitted with fewer safety features. As a result it is more difficult for organisations to demonstrate that they are meeting this duty of care requirement.”
Last but definitely not least, there are the advantages to the environment. Company cars, being several years younger on average than employee-owned vehicles, help reduce fleet emissions. And there are much bigger incentives for company car drivers to go green than if they were buying their own vehicle.
Fleet managers should be encouraged to shout about this, and even build an environmental policy around your fleet. What better way to beef up your business’s green credentials and appeal to the newer, eco-savvy employees and customers?
Are you wondering what’s the best approach for your fleet? Contact us now for bespoke advice tailored to your business.
Photo, top: Not the best image for your business [credit: Phillip Pessar]