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Should the employer provide a company car or should the employee use own car for business travel?

In deciding whether to offer employees a company car as a standard benefit, or in structuring and costing a flexible benefit scheme (see the Flexible benefits schemes ― an overview guidance note), the employer may well need to know in advance how likely it is that the offer of a car will be taken up or whether an alternative should be offered. In addition, now with the OpRA rules (see the Optional remuneration arrangements guidance note), the calculation will need to take account of the correct value to be taxed where an option is given to the employee.

The answer to this question is complex and depends on a wide variety of factors. Whilst to some extent it is a matter of the employee’s personal choice, the employer can influence the decision when designing the company car offer or flexible benefits scheme by taking into account the tax and other factors that will be important to the employee in making