The Dos and Don’ts of company cars

For most people, the thought of buying some company cars for their business seems ever so slightly ridiculous. Business vehicles are usually associated with large corporations that can afford to treat their employees with a company car to use as and when they please. If you are just a small business, then this could be a very extravagant expense, right? Well, not always. If used correctly, company cars can be quite beneficial to most businesses.

One reason why they are so useful for some companies is that they are a sizeable expense. All of your business expenses will be added up at the end of the tax year and deducted from your profit. It is then just your net profit that you will be taxed on. So, as you can see, the cost of your company cars will be deducted from your gross profit and could help you significantly reduce your tax bill. Not only that, though, but these cars can be utilized in so many ways. Sure, you can offer them to your employees as a perk of the job, but they can also help with marketing and logistics.


However, when you do bring company cars into your company, you need to make sure you are using them as effectively as possible. Otherwise, they could just become a drain on your bank balance. Here are some dos and don’ts that can help you avoid that.

Do Be Aware Your Employees Might Not Want Them

Firstly, it’s important to point out that your employees might not actually want a company car in the first place. You should find this out before you invest in some, otherwise you might end up with a fleet of cars that you aren’t too sure what to do with. There’s one big reason why some employees will decline your offer of a company car: tax. Even though company cars will help to bring down your business’s tax, they could actually bump up your employees’. However, there are ways they can cut down this tax. For instance, if they don’t use their company car for private use then they won’t pay hardly any extra tax. Offering them low-emission cars and paying towards the cost of running the car yourself can also bring down their tax payments.


Do Utilize Them For Marketing Purposes

Before your employees start driving their cars around town, you might want to customize them so that they can help you with your marketing efforts. You just need to add your logo or branding to the car’s body. Then, anyone who sees the car will also see your company’s brand. You shouldn’t attempt to paint your car yourself. Instead, take it to a professional firm that offers powder coating services. If it’s metal, they can coat it, so they won’t have any trouble painting the body of your car with your design. Make sure it’s a bright and bold design so that the vehicle stands out to everyone who sees it. That way, they’ll remember it a lot better.

Don’t Just Use Them As Driving Adverts Though

Using your company cars is a great advantage for your marketing, but that’s not the only way you can utilize them in your company. In fact, some entrepreneurs decide to invest in a couple of extra ones so that they can take control of their own deliveries. This will then cut out the need for you to use a third-party courier service. Not only will that help you reduce your outsourcing expenses, but it can also improve your customer service. More often than not, courier services can be trusted to do a good job with your deliveries and orders. However, if they do let you down and your customers are angry with the service they receive, then their bad work will reflect poorly on your company. Some business owners would rather not run the risk of using a courier service in case this does happen, so they instead use their company cars for deliveries. Even though it means hiring a small team of delivery drivers, at least you will be able to train them so that they carry out their work to the high standard that you expect of them.


Do Be Strict With Employees

You need to be strict with your employees once you hand over the keys to their car. It is imperative that they understand that they need to drive safely. Not only will this keep them and other road users safe while behind the wheel, but it also means that their bad driving isn’t risking the reputation of your company. After all, they will be driving a car that has your company name on it, and any bad driving could dent your business’s reputation. If they are driving for their job, such as on deliveries, then they also need to know the number of required breaks they are legally permitted to take. This is incredibly important for their own safety as taking breaks can help reduce tiredness while driving.


Don’t Forget About Regular Maintenance

As the cars are always owned by the company, you will be responsible for any repairs and maintenance checks. You need to ensure that all the necessary checks are carried out routinely. This will help the cars function as they should, which should make them more efficient and cost-effective. Not only that, though, but it also ensures that they are safe to be on the road.

Do Screen Employees First

You might want to screen your employees before you offer them a company car. This will flag up any reasons why you shouldn’t give them a car in the first place. For example, they may have a bad track record of driving, such as having caused several crashes or have been caught driving under the influence of alcohol. You don’t have to give a car to an employee, and these are some very good reasons not to.

Follow these tips, and your company cars will be a great addition to your business!

*This is a contributed post

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