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Old 05.06.2020, 20:10
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company car option

I got an employment offer with an option for a company car with private use allowed - and I fail to see the benefit of it, so can I use the forum as a sounding board, please?

The offer says that 1% of the car's value will be added to my payslip for the private use of the car monthly (this case ca. 400CHF). Plus I can't deduct the way to work from taxes (3-4000 CHF). So in the end I end up with a car paid for by my employer, I save the leasing costs (about 5k pa) plus the insurances (2k?). But it costs me approximately 8'000 francs in taxation... That doesn't seem like a good deal to me...

If I chose to use my own car, besides having to buy it, I can have it reimbursed for business trips at 0.7CHF/km (estimates for this role might be 2-300 francs a month), which recuperates about 50% of its leasing cost, plus I can deduct the way to work (3-4k).

Option B sounds like a much better deal to me. Am I missing anything or is having a company car not really a thing in CH?
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  #2  
Old 05.06.2020, 21:17
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Re: company car option

You're numbers are completely wrong since you mix up tax and taxable income.

Have a talk with your employer and have him explain to you how it actually works.

And don't forget about the costs for repairs, service, mfk, tyres etc...
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Old 05.06.2020, 22:13
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Re: company car option

What is the car allowance? Take a cheaper leasing car and use the rest of the amount to allow for higher taxes.

As an example: company allows car for 1500 CHF. You lease a car for 1000 CHF. Company pays you the difference of 500 CHF which benefits towards towards the higher taxes.

Obviously only if your company allows this kind of deal.

And as EdwinNL said: full service leasing? If not, you may end of worse financially
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Old 05.06.2020, 22:19
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Re: company car option

It may not apply to you if you don't use your car for commuting long distance to work. However if you do then you have to account for the 2016 FABI commuting tax which is considerable and in my view completely negates any benefit to owning a company car for me (I pay almost CHF 8k in additional tax).
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Old 06.06.2020, 00:21
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Re: company car option

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You're numbers are completely wrong since you mix up tax and taxable income.
I guess I didn't make the distinction proper. Still I meant the right things, just bear with me

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And don't forget about the costs for repairs, service, mfk, tyres etc...
That'd be About zero apart from the 2 regular services for the first 4 years for a new car, especially with full service leasing, won't it?
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Old 06.06.2020, 00:23
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Re: company car option

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What is the car allowance? Take a cheaper leasing car and use the rest of the amount to allow for higher taxes.
It's not an allowance, it's a car. It says you get a car that is worth X francs, not the money to pay for the car.
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Old 06.06.2020, 02:45
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Re: company car option

Do they offer a car allowance option or only having the car?

One thing you did not consider when using your car for work is if accident happen you are responsible, not the company. Small chance and all but consider this in your pros and cons.

K
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Old 06.06.2020, 02:48
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Re: company car option

I don't get your calculations.

4800 CHF added to your taxable income
4000 CHF you cannot deduct for transport to work

Total=8800 CHF additional taxable income.

You mention additional taxes of 8000 CHF?

Even taking a high tax bracket and assuming this makes you jump a bracket hence you would pay 1-2% more overall, it still sounds high?
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Old 06.06.2020, 16:12
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Re: company car option

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I don't get your calculations.

4800 CHF added to your taxable income
4000 CHF you cannot deduct for transport to work

Total=8800 CHF additional taxable income.

You mention additional taxes of 8000 CHF?

Even taking a high tax bracket and assuming this makes you jump a bracket hence you would pay 1-2% more overall, it still sounds high?
sorry, I was sloppy with the terms.

8000-9000 CHF added to taxable income results in about 2500 CHF actual taxes. Seems not a bad deal if one gets a car, most of the petrol, the full casco insurance, the road tax and service and repair costs for an estimated 200 CHF a month. Disadvantage is that I can't pick my own car (this I might actually negotiate).

The other way around I'd pay about 2k for taxes and insurance (same amount I "lost" before) on top of the purchase price and run the additional cost of amortization. I calculate I can reclaim about 2-4k on running costs as per the 0.7 CHF rule reimbursement. Advantage: my car, disadvantage: my depreciation and my fuel costs.
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Old 07.06.2020, 03:06
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Re: company car option

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sorry, I was sloppy with the terms.

8000-9000 CHF added to taxable income results in about 2500 CHF actual taxes. Seems not a bad deal if one gets a car, most of the petrol, the full casco insurance, the road tax and service and repair costs for an estimated 200 CHF a month. Disadvantage is that I can't pick my own car (this I might actually negotiate).

The other way around I'd pay about 2k for taxes and insurance (same amount I "lost" before) on top of the purchase price and run the additional cost of amortization. I calculate I can reclaim about 2-4k on running costs as per the 0.7 CHF rule reimbursement. Advantage: my car, disadvantage: my depreciation and my fuel costs.
For me the above is a no brainer.... But then again I have never owned a car and don't understand how much "picking the car" is worth to you.

K
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Old 07.06.2020, 03:29
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Re: company car option

One cost that hasn't been mentioned is parking. Would you have to pay for the parking spaces (can run up to several hundred Francs per month), at your home, and at work? And the time to find a parking space.

I'd say: work out where you'd actually be using the car. For your daily commute? Then, compare those costs, advantages and disadvantages, in time and money, to the costs of public transport, including for your free time. Have a look at the freedom of an SBB GA. This is particularly more important if you have a spouse. And children who are over, say, age 10, and who will be travelling on their own (and they will be). Work out what it would mean, and cost, if everyone had his/her own transport, (each family member his/her own GA) as opposed to sharing this car.

For "car days", such as a big shop, or a fun day's excursion, you could rent a car for a few hours, or for a day, from mobility.ch.

I'd say that it's worth working out when, exactly, you'd be using this car, and comparing it to those costs and then negotiating with the employer to pay for the bundle that suits you best.

There are many people in Zurich who just prefer not to bother with the work of owning a car, and instead use public transport everywhere, only adding on mobility.ch whenever they do specifically need a car.
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Old 07.06.2020, 10:25
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Re: company car option

Assume you have a job where you must visit customers? What if the customer is right around the corner from you? Really want to drive the company car all the way back to work to pick up your private car, simply because you cant use the company car privately? In addition what you save in not owning a car will definitely cover the 10 to 15% in extra taxation. Basically think of it as having a car for 1K a year (due to taxation). Deals like this don't come often.
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Old 07.06.2020, 14:00
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Re: company car option

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Assume you have a job where you must visit customers? What if the customer is right around the corner from you? Really want to drive the company car all the way back to work to pick up your private car, simply because you cant use the company car privately? In addition what you save in not owning a car will definitely cover the 10 to 15% in extra taxation. Basically think of it as having a car for 1K a year (due to taxation). Deals like this don't come often.
yeah the job is customer facing - so you gotta be mobile enough to see most customers in a reasonable amount of travel time - but still allowing for private use (hence the flat taxation on top), so no worries about owning 2 cars (that was never on the table).
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Old 07.06.2020, 14:04
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Re: company car option

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One cost that hasn't been mentioned is parking. Would you have to pay for the parking spaces (can run up to several hundred Francs per month), at your home, and at work? And the time to find a parking space.
company parking is provided at no cost, private parking at home is the same cost for a private vs company-owned vehicle.

Quote:
I'd say: work out where you'd actually be using the car. For your daily commute? Then, compare those costs, advantages and disadvantages, in time and money, to the costs of public transport, including for your free time. Have a look at the freedom of an SBB GA. This is particularly more important if you have a spouse. And children who are over, say, age 10, and who will be travelling on their own (and they will be). Work out what it would mean, and cost, if everyone had his/her own transport, (each family member his/her own GA) as opposed to sharing this car.
the question was not about having or not having a car, that's a different thing altogether and I'm happy to say that I managed to not have a car nor an SBB abo of any kind in the last 12 months, so I know what you mean.

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I'd say that it's worth working out when, exactly, you'd be using this car, and comparing it to those costs and then negotiating with the employer to pay for the bundle that suits you best.
For me that's too many moving targets. Ideal worlds don't exist too often, or they don't tend to last. The employer is asking Yes/No on the current offer so I can't say that my ideal combo would look like this or that, as that might also change in a year's time.
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Old 07.06.2020, 16:34
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Re: company car option

If you take the car, be sure to get every single item listed, in writing, as being either their or your responsibility (I mean, to do the work, like wash the car, and take it to the service, and getting the tyres changed), and also at whose expense.

I've seen car deals go badly wrong when someone just assumed that some aspect of the insurances and other running costs would be covered by the other party.
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Old 07.06.2020, 23:39
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Re: company car option

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If you take the car, be sure to get every single item listed, in writing, as being either their or your responsibility (I mean, to do the work, like wash the car, and take it to the service, and getting the tyres changed), and also at whose expense.

I've seen car deals go badly wrong when someone just assumed that some aspect of the insurances and other running costs would be covered by the other party.
good point, thanks. In my home country in Eastern-Europe a company car is an all-in package, with company petrol card, company washes and company-managed service trips and tyre changes, and that with a valet service (just drop the keys). I think Switzerland will not be that generous, but let's see.
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Old 08.06.2020, 08:49
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Re: company car option

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If you take the car, be sure to get every single item listed, in writing, as being either their or your responsibility (I mean, to do the work, like wash the car, and take it to the service, and getting the tyres changed), and also at whose expense.

I've seen car deals go badly wrong when someone just assumed that some aspect of the insurances and other running costs would be covered by the other party.
In my last two companies its been the same. Servicing, maintenance, tyres, fuel, insurance, tax etc.. are on the company and car washes and general upkeep are on you. Of course you need to take it to the garage and tyre change shop, but you just show them your service card (assuming your company uses fleet management)
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Old 08.06.2020, 09:31
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Re: company car option

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good point, thanks. In my home country in Eastern-Europe a company car is an all-in package, with company petrol card, company washes and company-managed service trips and tyre changes, and that with a valet service (just drop the keys). I think Switzerland will not be that generous, but let's see.

Depends on the packaged the company takes, had a full in package as well (petrol, tires, washing etc all included)
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Old 11.06.2020, 11:54
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Re: company car option

So, the package is "all in" minus car wash.

Alternatively one can have an own car that will be reimbursed at 0.7CHF/km.
Is there a tipping point in km where that would make sense?
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Old 11.06.2020, 11:59
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Re: company car option

My employer offered me a company car but I asked for a 1st class GA instead. It came out cheaper for the company and it came out cheaper for me.

They agreed.
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