Every successful business must be able to recruit the right talent. Often, this means offering an attractive salary and a succession of perks.
Among the most effective of these perks is a company car scheme. With the help of such a scheme, you’ll be able to win over would-be recruits and ensure that they can work effectively once they’re in position.
What is a company car?
A company car is a car that’s provided, indirectly or directly, by a given company to a given employee. They come in many different shapes and sizes to suit a range of circumstances.
Different sorts of cars will be suitable for different sorts of roles and businesses. If you want to appeal to an executive class, you might offer something luxurious. This needn’t mean spending over the odds. However, you can pick up a used Audi or equivalent online without breaking the bank.
Why offer a company car scheme?
A company car scheme allows you to extend your appeal. If transport is an issue for an employee, then providing the right vehicle might help address it. The right car also offers all of the lifestyle benefits of car ownership while avoiding the drawbacks and running costs that come with ownership. By providing your employees with something as valuable and desirable as a car, you’ll demonstrate a degree of trust in their ability to repay the investment. On top of all the other practical benefits, it’s a signal of good faith, and this will encourage your employees to adopt the Working Time Regulations.
What company car schemes are available?
There are several different ways to offer your employees a company car.
The most straightforward option is for the company to buy a fleet of vehicles and then let employees take them home. The company will be able to control business rates more easily since it will decide which cars are bought. There are also economies of scale when it comes to maintenance, and your tax burden may be lower. On the other hand, you’ll probably be looking at steeper startup costs.
Employee car allowance
Another option is to pay your employees extra in order to facilitate a new car. This way, the employee gets a choice about which car they’re buying and how much they’re buying it for. They’ll also get to keep the vehicle when they leave the business.
Employee salary sacrifice scheme
If an employee is willing to give up a portion of their gross salary to pay for a car, then it might work out as more cost-effective, thanks to income tax and national insurance savings. When employees are just creeping past the higher and additional rates for income tax, you might see a higher demand for this kind of thing.