Hi,

I would like to buy my company car, but life isn't as easy as I thought.

Being naive in the ways of accountancy, I thought I could just have it for the remaining 'bubble price'. After all, in years gone by I would just return the car and buy another new one. So, to me, the car is worthless to the company as it would be handed back.

But, apparently, the company has to buy the car with the bubble price left and then sell it to me at 'market value'.

I have googled around and apparently I need to get a trade->trade valuation and from there I can knock bits of to cover ware n tear as a normal buyer would.

Can anybody advise on a trade->trade valuation on an 09 Limited Edition ?

Thanks

That'll depend a lot on if it's diesel/petrol, mileage, service history and condition...

*edit, just seen 'CR' in your profile.

Edited 22 December, 201114 yr by silver1011

webuyanycar.com or whatcar.co.uk valuations are free or you can buy a proper glasses guide valuation for a few quid.

Go to a skoda dealer, persuade them to give you a valuation letter on there letter headed paper with a nic LOW value. Take to you employers. Job done. I worked in the trade and have done this before.

Buckles

Go to a skoda dealer, persuade them to give you a valuation letter on there letter headed paper with a nic LOW value. Take to you employers. Job done. I worked in the trade and have done this before.

Buckles

Thanks Buckles I thought this would be the best case - it's the "persuade" I am concerned about... And the revenues use of Parkers, of course.

£8.5k to £9k looking here http://www.networkq.co.uk/buying/value-your-car/

Parkers is rubbish btw - the trade would laugh at you if you quoted that..

:yes:

Parkers is rubbish btw - the trade would laugh at you if you quoted that..

:yes:

Agree, everything the trade do is through glasses guide or CAP. And whatever the book say they will still knock a grand or so off that value. Good luck

Buckles

Edited 23 December, 201114 yr by Buckles

Isn't the point that your company doesn't actually own the car as its leased so they would have to buy it to sell to you? I wouldn't imagine there's a standard option to buy (ie bubble) in a commercial B2B lease.

Wouldn't it make more sense to be talking to the leasing company? As far as I can see you're haggling the price with the leasing company through your employer who presumably has limited interest in and time to spend on you owning the car and getting the best price.

Also I would imagine the leasing company has a pretty good idea of the value of your motor, I shouldn't think you will be setting the price.

Never had a company car so might be talking rubbish but this is the way it seems to me.

Edited 23 December, 201114 yr by juan27

Isn't the point that your company doesn't actually own the car as its leased so they would have to buy it to sell to you? I wouldn't imagine there's a standard option to buy (ie bubble) in a commercial B2B lease.

Wouldn't it make more sense to be talking to the leasing company? As far as I can see you're haggling the price with the leasing company through your employer who presumably has limited interest in and time to spend on you owning the car and getting the best price.

Also I would imagine the leasing company has a pretty good idea of the value of your motor, I shouldn't think you will be setting the price.

Never had a company car so might be talking rubbish but this is the way it seems to me.

Yeah this all makes sense. An avenue I'll look at is 'handing the car back' - that is having the company hand the car back, then having me buy it from lease company / pay final payment. I'll wade through the small print.

It's HP so following final payment the car is owned, so final payment is set already. Thing is the car is worth more than that final payment hence the difficulty in selling it to me for that lower than market value price.

So if it has been bought by the company on HP then a leasing company would have no interest in the car once the final payment has been made. If that is the case then it will be a simple matter of buying the car off your company for whatever is the agreed price.

Ian

So if it has been bought by the company on HP then a leasing company would have no interest in the car once the final payment has been made. If that is the case then it will be a simple matter of buying the car off your company for whatever is the agreed price.

Ian

Surely companies don't buy cars on HP? This all seems a bit strange. Surely it must be leased.

Why oh why would the employer sell the OP a car at less than market price?

Edited 28 December, 201114 yr by juan27

Hi Zacherynuk, there seems to be a little confusion over this. A company would logically lease the car off the leasing company and then just hand it back without any further payment at the end of the hire period. You would then need to get in touch with the leasing company and find how they will dispose of the car and how much they are looking for. HP is a hire purchase agreement as we all know so the company owns the car outright once final payment is made. If the car has been bought by the company then the next move will be to the finance director. Good luck in your endeavours.

Ian

Surely companies don't buy cars on HP? This all seems a bit strange. Surely it must be leased.

Why oh why would the employer sell the OP a car at less than market price?

Juan27, it all depends on their accountants. If a cars value has been written off in the books, i.e. it is effectively a worthless asset to the company, then any money the company receive for the sale of the car is pure profit.

Juan27, it all depends on their accountants. If a cars value has been written off in the books, i.e. it is effectively a worthless asset to the company, then any money the company receive for the sale of the car is pure profit.

That makes perfect sense then. I expect the OP will get it for a fiver on that basis...

Edited 29 December, 201114 yr by juan27

From your point of view the webuyanycar quotes will probably be the best because they are the lowest.

I suspect your company will want a paid for CAP or Glasses price. You'd have to get both as there can be a considerable difference between them.

I think the company has to get 'market value' or the taxman can come querying why they are 'giving away' assets.

CAP is based on auction prices so that might be your best option for a usable lowest price.

Hmmmm. Some very good points.

The Car was 'purchased' (leased) by the company with a view to sending it back at the end of the term (3 years); as with previous cars, at the end of this term the company gets the choice of purchasing the car for a pre-agreed 'balloon' amount.

The issue is, if the company does indeed 'buy' the car, then it becomes a company (incorrectly defined imho) asset and must be sold for market value, regardless of company worth or actual profit made (Unlike every other aspect of business).

'Market Value' is a crappy term; a rolling average of whatever somebody has paid over a defined previous period for goods /similar/ to the ones you are selling. Worst case, it is a price defined by non-professionals (eg: Estate Agents, Salesmen, Recruitment 'consultants') as a required mode to retain their profit, regardless of actual market sales.

For this purpose I was expecting to be able to get a business to business (b2b) or trade to trade valuation, which is obviously lower than Trade=>consumer. Often Significantly. Before people start whining and getting their hopes up, consumer laws protect consumers and cost businesses millions; they don't protect businesses from businesses. They aren't an insurance either. Anyways, as my company isn't in the motor trade, this isn't a realistic option, although it has been pursued and quotations received may be used.

The thing is I don't require a new car and would rather keep this one. It's very nice indeed thank you.

The crux is, my company can't sell me the car I have been driving for 3 years for the same amount of money as it would cost my company to be able to do so because the government says this would be open to abuse. What a load of twaddle, the bunch of thieving, lieing, caniving two-arsed cowards that they are would rather my company hands the value of this car to the credit firm rather than pass it to me.

The irony is. The company could sell it to you.

So, I will have to try and purchase the car from the lease company, following car hand-back. Or simply accept a brand new car.

Juan27, it all depends on their accountants. If a cars value has been written off in the books, i.e. it is effectively a worthless asset to the company, then any money the company receive for the sale of the car is pure profit.

Obviously if you owned a business, and owned a 3 year old Skoda that had been 'written off'' in the books you would sell it for peanuts? ......... course you would.

The issue is, if the company does indeed 'buy' the car, then it becomes a company (incorrectly defined imho) asset and must be sold for market value, regardless of company worth or actual profit made (Unlike every other aspect of business).

I can appreciate your frustration but why is this incorrect? The company has the contract with the leasing company not you. The fact that you've driven around in the car for 3 years doesn't automatically give you a right to ownership.

To be brutally frank the company is doing you a favour offering to sell you the car at "market value" as they are taking on an apparently unwanted financial liability in the process and presumably incurring some admin costs too.

After all you are getting a "known quantity" for the same money as taking potluck at an auction.That's got to be worth something to you surely?

Edited 30 December, 201114 yr by juan27

To be brutally frank the company is doing you a favour offering to sell you the car at "market value" as they are taking on an apparently unwanted financial liability in the process and presumably incurring some admin costs too.

As one of the directors of the company, I don't think you do appreciate my frustration.

Come February the car is worthless to the company and will be handed back to the finance company. The company would incur zero costs selling me the car, whereas the alternative is that the company pays another 15-20k to have me drive around in a new car. (Of course the company could buy the 3 year old car for me to drive, but that would be risky for repairs and stupid for my tax)

Obviously if you owned a business, and owned a 3 year old Skoda that had been 'written off'' in the books you would sell it for peanuts? ......... course you would.

Of course you would...NOT!!

Zacherynuk, I can see your frustration now, as a director of the company it would be nice and easy to just purchase the car for the balloon payment at the end of the lease term and transfer ownership, therefore tax liabilities etc, to yourself as a private individual within a reasonable amount of time. Typical government, they like to give each other money to pay for essentials like duck ponds but then there is something they can do to help the beleagured British industry they put two fingers up and say no way.

There has to be a way around this using a bit of creative accountancy, which is legal of course!!, Perhaps you could pay the "market value" and then get a nice little bonus at the end of the financial year

Ian

As one of the directors of the company, I don't think you do appreciate my frustration.

Come February the car is worthless to the company and will be handed back to the finance company. The company would incur zero costs selling me the car, whereas the alternative is that the company pays another 15-20k to have me drive around in a new car. (Of course the company could buy the 3 year old car for me to drive, but that would be risky for repairs and stupid for my tax)

If its really zero cost to the company to buy 3 year old cars at significantly below market value why don't they exercise their purchase option on every car and sell them at auction for a profit?

If the purchase option price is so much less than the market price surely that suggests the company must have been paying over the odds for the lease. All this doesn't add up.

Edited 2 January, 201214 yr by juan27