The pros of getting a company car
When you list out the advantages of getting a company car, it may seem quite apparent why it is seen as such a perk. First of all, since it is a company-owned vehicle, your employer will cover a huge number of the costs including maintenance and servicing. Not only this, insurance comes as part of the package. Wear and tear costs are taken care of. You may even have a say what type of vehicle you want. You don’t have to go through the hassle of going through the sales process at the end of its term, and you are regularly offered a vehicle which is kitted out with all the latest features.
On the downside…
As with everything in your working life, there are always going to be a couple of downsides to consider. Firstly, this is a system that makes less efficient models an expensive prospect. Your company may restrict you to only a few models from a particular brand, and you often don’t have the option to buy the car at the end.
What about the cash alternative?
Instead of supplying you with a car directly, many employers are now opting to give you a direct cash benefit. One of the major plus points is that you have a much wider range of vehicles to choose from. As well as this, you can choose the financing method which works best for you. You can always look into a fuel card as well. You are likely to still be entitled to mileage reimbursements though this always depends on the employer.
And the negatives?
The most obvious negative involved in the car allowance system is that you will be responsible for the upkeep of the vehicle including maintenance costs and wear and tear. As well as this, insurance is usually not included in the scheme.
To conclude
As with most aspects of driving for work, the choice very much depends on your personal circumstances. It is worth calculating the costs and tax benefits involved in both schemes so that you can work out which one will be more beneficial financially. A couple of the other factors which may make a difference to you include how eco-friendly your preferred model is and any fuel benefits that you may receive from your employer. While many people will make the decision from a purely financial standpoint, you may decide that these or other factors influence your choice. Hopefully, seeing some of the pros and cons listed together in a single article have helped you in the decision-making process.
