Getting a Company Car: Buying, HP, Lease or PCP?

So you have decided to acquire a company car through the company and now need to decide on how to finance it. Vans, including some pick-up trucks, are treated as plant and machinery by HMRC and are taxed differently. Please see our article on vans here.

 

Whichever option is most suitable for you, the vehicle must be in the Company name. Vehicles purchased and financed in your name will not be treated as company vehicles. If you have any questions, please forward a draft copy of your agreement to your account manager.

 

You should already be aware of the benefit-in-kind tax charges and note that, in most cases, VAT cannot be reclaimed on cars (vans are not cars).

There are four main ways of obtaining a car, each with advantages and different tax treatments. Here's a detailed breakdown of each method.

This is summarised in the table below. 

If you want to read a more technical breakdown of the different finance options, please see our article here.

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