BIK 9k per annum or 9k raise

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Familyman77

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Hi all, BIK has just increased on company car to 9k per annum. What would people's thoughts be on paying the BIK or take 9k through payroll and source my own vehicle. I would not do big mileage so this increases the BIK. My initial thoughts are to stay as is
 
As much as it would pain me to pay the extra BIK I think I would.

The 9k has a net value of around 350-375 /month, depending on circumstancees

I think the value of a relatively new car , tax , insured, serviced and any related costs covered better value that what I could do for €360/375 month.
 
@Savvy , I may have a similar decision ahaead of me in 2023. Can you share how you figured out the numbers for the 9k example please?
I currently have no BIK or allowance or experience of reckoning it out so this will be new to me.

Thanks in advance.
 
Remember it's the tax on the BIK amount plus the net from the allowance, so closer to 9k net to run your own car, and I assume claim milage for business travel.
Can you get, run a car for this, as also a lot of comp insurance policies not good for claims free driving when you do come to get your own policy.
 
So a €4,500 cost to you to have a new car with everything paid for?

Versus €4,500 paid to you (after tax) and you look after yourself.

Would you be paid mileage in the second scenario and, if so, what’s your annual mileage (low you say)?
 
Gordon Gekko said:
So a €4,500 cost to you to have a new car with everything paid for?

Versus €4,500 paid to you (after tax) and you look after yourself.

Would you be paid mileage in the second scenario and, if so, what’s your annual mileage (low you say)?
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Gordon, I would have a fuel card as opposed mileage. Mileage would be around 20-25km per year
 
If it was me I'd take the money as salary and deal with my own transport needs. But I'm not a flash car person.
 
ClubMan said:
If it was me I'd take the money as salary and deal with my own transport needs. But I'm not a flash car person.
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I was thinking that the decision will come down to how much value I put on the nice 2 year old car versus making a bit of money by having a 10 year old car
 
Familyman77 said:
All fuel paid for instead of paying mileage
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Have I understood correctly, you've a choice between:
1. Base salary plus fully expensed car, paying BIK on 9k value, or
2. Base salary, plus taxable cash allowance of 9k, plus all fuel paid by employer, tax free?

I'd be taking option 2.
 
So €4,500 of my own money a year to have a new car and everything paid for.

Versus €4,500 paid to me each year plus free fuel and I buy my own car.

I think I’d go for the second option.
 
I don’t know if you have an occupational pension scheme at work, but if you do and they match say 5% that also helps push it towards the pay rise. If you need a mortgage the extra 9k will help too.
 
I think if it was me I'd be asking myself a few questions before making the change
How often is the company car changed, every 3,5 or 7 years
How much is your insurance going to be, do you need commercial insurance and do you have a NCD
The company is paying for the fuel but who's paying for the maintenance and repairs for the car
Will running my own car cost me more then the €4.5k that I'll net from the car allowance
So the real question I'd be asking myself is what car would €4.5k get me after insurance, tax and maintenance are paid for
and how does this compare to the all expenses paid new car offered by the company every 3,5 or 7 years
If the company car is changed frequently I'd probably stick with it
 
The difference between the two isn’t €4,500 though, it’s €9,000.

They take €4,500 of the person’s money for a new car versus the person getting paid €4,500 to have my own, with the important kicker of a fuel card.
 
Gordon Gekko said:
The difference between the two isn’t €4,500 though, it’s €9,000.

They take €4,500 of the person’s money for a new car versus the person getting paid €4,500 to have my own, with the important kicker of a fuel card.
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Would agree totally, that it is not just the extra €4.5k but also the saving of not paying the BIK gives you more to play with
but comparing like for like can the OP buy a €45k new car and run it for 3 to 5 years on €9k??
I would think if they have to borrow the money to buy the car that it would be a close call as to which is the better option for the OP
Of course if their not interested in having a new car and don't mind driving a second hand car then the car allowance is the way to go
 
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