Home > Company Car Schemes > Advantages of a Company Car Scheme for Employers

Advantages of a Company Car Scheme for Employers

By: J.A.J Aaronson - Updated: 2 Nov 2010 | comments*Discuss
Advantages Of A Company Car Scheme For Employers

The company car is still amongst the most popular benefits offered to employees in the UK. The tax schedule for the company car scheme was revised in 202, and again in 2006, with an increased emphasis now placed on encouraging the use of green vehicles. Where tax liabilities had previously been calculated with regard to miles travelled, the new schedule now results in a higher liability for vehicles with higher emissions.

This has encouraged many employers to move to schemes like Employee Car Ownership, or other travel benefits such as cycle to work schemes of interest free travel loans. That said, a company car scheme is still very popular amongst employees and employers. The advantages for employees are clear: in a well managed scheme, they should receive a tax benefit greater than the equivalent cost of running their own vehicle.

Furthermore, it is likely that they will have the use of a car that is of higher quality than that which they would be able to purchase themselves. However, there are also important advantages for employers.


In the first instance, it should be remembered that a company car scheme is a necessity for some organisations. For example, a company that employs travelling salesmen would generally be expected to provide the means of transport necessary for the employees to do their job.

This would generally take the form of a company car fleet, although some employers may choose to offer a scheme like Employee Car Ownership. Similarly, firms like plumbing companies will generally need to provide a fleet of vans or other vehicles simply in order to be able to do their job. In this way, a company car (or van) scheme is frequently not just advantageous, but simply necessary.

Clearly, however, the are instances in which the use of a company car scheme is extended to employees who do not necessarily require a car for work purposes. Many companies provide a company car scheme as part of their employee benefits package, presenting it completely as a perk, rather than something that has some business use.

The advantages to employers of this type of scheme are very similar to the advantages of any employee benefits; on a basic level, a comprehensive benefits package will make your company more attractive to potential recruits. This is particularly the case if your organisation is based outside a town or city, or is not easily accessible by public transport. In these cases, a company car scheme or some other transport benefit will be advantageous.

A company car scheme can also help to develop goodwill on the part of your employees. As has been mentioned, this is a popular benefit and one which can therefore foster a sense of positivity amongst your workforce. Furthermore, an emphasis on the potential tax benefits of a company car scheme can again help to produce a positive workforce, and one which is happier with its pay packet.

In this way, advantages for employees are also advantages for employers as they encourage employee satisfaction and loyalty, both of which are important for a productive workforce.

Website Design and Hosting

If you are looking to increase brand awareness, generate web enquiries and/or generate online sales ISD will create an affordable, mobile friendly, secure website - check out In Studio Design.

Based in the UK, skilled in WordPress, web design, ecommerce and illustration, they will build your site quickly, host it on a high performance server, and make it SEO friendly.

You might also like...
Share Your Story, Join the Discussion or Seek Advice..
Why not be the first to leave a comment for discussion, ask for advice or share your story...

If you'd like to ask a question one of our experts (workload permitting) or a helpful reader hopefully can help you... We also love comments and interesting stories

(never shown)
(never shown)
(never shown)
(never shown)
Enter word: