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Tax on Car Allowance

(2 Posts)
Lorelilee Mon 15-Apr-13 18:30:37

I'm looking for a wee bit help re a potential new job. I have been offered a salary of £30K, plus a £5K car allowance. Can someone please advise what my take home pay will be - i.e. do I get taxed more on the allowance?


CogitoErgoSometimes Tue 16-Apr-13 13:40:23

If the allowance is delivered as cash for you to buy/lease/insure/maintain your own car (which is what it sounds like) you'll be taxed as if you earn a total of £35,000 but you are potentially able to claim expenses from your company for business mileage. If the allowance is delivered in the form of an actual taxed, insured & fuelled car - say you had a monthly lease budget of £400 for example - then you'd be taxed on £30,000 income plus you'd be taxed for the value of the car/fuel available to you.

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