Employers not offering a company car as part of a recruitment package could be losing out on key talent, according to research from OSV.
It surveyed a group of company car users and more than a quarter (27%) said they have declined job offers where there was no company car included.
Half of respondents stated that they would consider accepting a job that didn’t otherwise appeal, if a car they couldn’t afford privately came as part of the package.
Despite this, more than half of those interviewed admitted that they didn’t understand Benefit-in-kind (BIK) tax regulations.
The majority (53%) of drivers interviewed still believe that company car tax is based purely on the cost of the new car.
Almost a third (30%) of respondents had no idea whether the choice of electric, diesel, petrol or hybrid vehicles would impact upon their BIK rate.
Another BiK factor that continues to cause driver confusion is usage – more than half (54%) of drivers were not aware that part-time use could lower their BIK rate. A further 29% said that they couldn’t explain how company cars impact upon their taxes at all and just accepted what came out of their pay packet.
OSV joint company director, Andrew Kirkley said: “Company cars have always been one of the top employee perks and it’s interesting to see how businesses can use that to secure the best talent. However, it is a bit of a worry that there’s such confusion over what company car use can mean for employees.
“The BiK regulations aren’t the easiest to understand, but it’s really important that drivers try to get their heads around the facts if they wish to avoid paying more than they need to.
“55% of new cars registered in the UK are fleet cars, and businesses will often give employees a choice of motors, but that decision could have really big implications for driver’s wallets. By choosing a diesel over a hybrid, for example, they could be significantly out of pocket in the long run. Remembering to declare part-time use could also affect a driver’s outgoings.
“Having a company car can really make financial sense, but you have to make sure that you get the best deal for you, and understanding BiK is integral to that.”