Conference terri::cars_uk

    Please explain point 5. Thanks..
    
    Stu.

    It appears that vat is going to 17�%. I don't know why this
    specifically affects the motor trade though.
    
    - Roy

�    2 Taxes on company cars � ?
    
    N.I. Contributions to be paid - according to other replies/conferences.
    Not sure if 'employees' NI to be paid, but very likely that 'employers'
    NI contribution will do (he doesn't like contractor's then !).
    
�    5 Get THIS VAT 17 1/2% Thats going to kill the car trade
    
    17.5% VAT - that will put inflation up, won't it ?
    
    'kill the car trade' - I thought it was already dead !
    
    J.R.

    
    I won't be asking the government to organise that party I've 
    planned to hold in a brewery! 
    
    Mark
    
    PS 17.5 VAT, no that's not inflationary! :^(

    re .1 Next to a house the next most expenxive purchase is a car
    therefore on a car  of �60000 an extra �150 will have to be payed.
    Gentleman from the Motor retail association said last night said "This is
    going to kill the trade"                         

    
�    therefore on a car  of �60000 an extra �150 will have to be payed.
    
    
    	Anyone splashing out 60k �'s on a car wont worry about an extra 
    	�150 :-)
    
    
    
    	

    Yes but if I had typed it in correctly in the first place at �6000 an
    extra �150 would make a difference.

	Extra bit of VAT destroying the market?. Pah!.

	There's masses of 'meat' in new car prices, they're just 
	whingeing.

	-John

�	There's masses of 'meat' in new car prices, they're just 
    
    Yeah, the previously quoted �150 could be recovered by asking
    for a discount on the price of the vehicle in almost all cases.
    
    J.R.

>>�	There's masses of 'meat' in new car prices, they're just 
 
I always knew the UK had high car prices compared with most of the rest of
Europe (excluding Scandinavia and Greece!), but it was only when I got to go
around most of the rest of the world that I found out just how expensive they
really are.  Example - top of the line Buick loaded with every imaginable
option from 6 speaker sound system to power everything can be driven out of the
showroom for around $20,000 including all taxes.  It competes with the top of
the line Volvos, which I know in the UK cost at least that in pounds!  At the
other end, I could, if I were that way inclined, buy a Hyundai Excel (like the
Pony, but better) for just $5500, plus tax - total $5750.  You work that out at
$1.96 to the pound!  Hondas and Toyotas and other tin boxes are much cheaper
here, too - and their exhausts don't seem to smell :^)

    I am surprised at the silence over petrol prices.   Why isn't everyone
    squealing like stuck pigs, like they usually do?  Did the Chancellor
    confuse most folks by referring to LITRES?
    
    18 pence a gallon seems like a hefty price hike to me...
    
    Nige L.

    Re: �seems like a hefty price hike
    
    Yes, I agree (initially I thought it was gallons not litres so I was
    well shocked when I found out). No point in "squealing" as there is not a
    lot you can do about it (except buy less petrol).
    
    This is obviously going to have implications on food prices etc.
    Hopefully the petrol companies will lower their prices slightly to
    compensate. They've done it in the past.
    
    - Roy
    

	� No point in "squealing" as there is not a
	� lot you can do about it (except buy less petrol).

	Very amusing.

	Range Rover owner.

	And with the added vat on 1st April, the overall hike is 22p for 4*


	The VAT may have put up inflation, however, the �140 per person relief
	on the poll tax should level it out.

	Heather

    I would not get too excited about the 140 pounds reduction in poll-tax.
    They squeezed enough out of us and will stitch us up well and good with
    the Company car tax. If anyone thinks they are better off today,
    remember to think of your tomorrow. "If they can tax it today, they can
    increase the tax tomorrow" is what I would go by.
    
    Consider the two adult household in Berkshire, my figures (sterling) are
    approximate,
    
    	Annual Charge under Rates System	~ 550
    	  "	  "	"       Poll Tax 	~ 800
    			
    				Increase	~ 68%
    				
    	  "	  "   after 140 Deductor 	~ 520
    				
    Once you have allowed for the erosion in the value of pound, I don't
    think there is anything to write home about. What it basically amounts
    to is that last year day light robbery was on the high but this year it
    became too obvious.
    
    If this was not enough, we will loose a little more in car tax and if
    you don't have that perk then you will loose just as much through VAT
    on drinks, smoking and bus fares, ha..ha.
    
    That's how it is folks for those on the base rate of Income Tax. Rich
    were born to get richer and poor... well someone has to be poor, else 
    how would rich know they were rich. 
    
    Perwesh 

    
 >>   on drinks, smoking and bus fares, ha..ha.
    
    I don't think there's any VAT on public transport (bus/train) fares.
    They may go up though, because of increased VAT on fuel....
   

	yup,

	No VAT on bus fares(or any public transport), food, gas/electric/
	fuel for domestic heating/lighting..........


	But, as you say, I expect it'll all go up anyway!

	Heather

Some of us made out 8-)

	1988 rates paid		1750	
	1989 poll tax paid	 634	(2 adults)

(end of rathole)		

    Well, I'm glad I didn't go for a company car, and bought my own
    instead. Still, everything else is going up... VAT at 17.5%. Most
    things I buy won't be affected, though my hobby (PC's) will go up.
    Petrol wise, I use unleaded. Why didn't he make the increase lower?

    
    
    Better tax those that can afford to spend money, than those who
    don't have money to spend.
    
    Richard.

    
    Re .19
    
    Hope it wasn't a new car you bought...
    
    My wifes company Pug 309GTi lease has just expired and so we asked for
    a price to buy, PHH asked 5k, ehmm considering it was well over 10k
    when new that means over 5k depreciation! After talking to a few
    dealers they said they wouldn't pay much over 4k even with less than 
    30,000 on the clock.
    
    So even buying your own car may not get you off the hook..!
    
    Kev..

    Yep, brand new, cost me �5,000. I paid cash, so I got a discount. It
    was valued at �3000 last year. Still going strong. True, I pay my own
    insurance, maintenance. I estimated the lease scheme would have cost
    �6000 from my salary (before tax) over three years since I'm not a
    qualified user. After three years, it wouldn't be my car, and I'd still
    have to pay for it. True, I could have a more upmarket car than the
    basr model Astra I bought, but I got all the features I wanted anyway -
    including the 5 speed gearbox option that added �190 to the price
    (making it �5000!).
    
    Pete.

	June 84 Bought a pug 205  1.3gr for       	�4750

	6 months later - change to enter lease scheme. I turned it down.

	
	June 87 traded in Pug for 	  		�3500
	June 87 bought ex-demo 2.EFI MG Maestro 	�7000 (�10,000 new)

	March 90 traded in Maestro			�4500
	March 90 bought ex-demo 2.0gti Montego		�9000 (�12,500 new)


	Depreciation over 1st 3 years 		- �1,250
	Depreciation over next 2 years 9 months - �2,500


	Heather

�	Depreciation over next 2 years 9 months - �2,500
    
    I think there are two points you have 'missed out'.
    
    First, the residual value of the car you now own.
    
    Second, running costs (servicing) which you have had to pay for
    (lease cars are serviced for you, aren't they?).
    
    Overall, things come out even better than you have described...
    
    J.R.

    
    Biggest costs of car ownership aside from depreciation 
    are interest charges.

    If you have the money and pay cash, you lose earning interest
    on the capital...
    
    �9000 invested in Banks/Building Societies would net at least 
    11% p.a.  
    
    If you don't have the money and have to borrow it you're likely
    to pay around 15%+ at least on 'used' cars. Often much more. A lot
    of the garages who advertise in Auto Trader quote 19+% like they
    were doing you some kind of favour. (Banks etc want around 24% APR 
    for car purchases - source Midland/Nat West)
    
    Manufacturers do offer finance incentives on NEW cars, but then you're only
    talking discount on list - and not the sort of saving of 'ex-demo' prices.

    

>    First, the residual value of the car you now own.
 
	Yup, but I assume I'll trade it in again.............
   
>    Second, running costs (servicing) which you have had to pay for
>    (lease cars are serviced for you, aren't they?).
 
	Servicing doesn't cost me much - I do about 30,000 over 3 years.
	I have the "mr. mechanic" warranty, which means I don't have to take
	it back to the garage to keep the warranty - I could do it myself...
	....however I don't, but I know a guy who runs his own business
	servicing and tuning, so I get a really good deal.

	And on to financing...................

	I have the money, so pay the diffence. Then I work out how much the 
	financing would cost, and pay that to myself monthly - not only does it
 	build up enough to fund the next trade-in, it also pays for a holiday 
	abroad for me and Dave every year. This year - Canada. AND, it's a lot 
	less monthly than I'd have to pay to the lease scheme.

	I'd much rather pay the interest to me, than someone else!

	Heather

If I had enough cash to pay for a car, it wouldn't be in a building society
anyway - it would be spent on other things.  Allowing 11% "interest" is a
non sequitor.  Anyway, as a non-resident I can get 15.25% :-) :-) but I still
don't have any savings :-( :-( other than the usual BT, TSB, British Gas ....

Running costs are very much dependent on personal circumstances.  There can
be no valid comparison made between the costs allowed for by a lease company
and the money spent on a personal car.  If you try it, I can prove you wrong,
whichever way you look.

At the end of the day, it boils down to personal preference as to how *you*
wish to spend your money.  90% of this decision is subjective and, as far as
cars are concerned, predictably irrational.  It's the same as "should I buy
a new Blob GLS, or a slightly used Super-Splash GXL?"  Once you get beyond
"new or used" it makes no difference.

As was said, you pays your money .....

Brian

(PS - I used to prove that my Volvo cost #34 per week total, versus the #46
      per week quoted on the lease scheme.  Great at manipulating figures!)

>>      <<< Note 1395.23 by SUBURB::THOMASH "The Devon Dumpling" >>>
>>                 -< you pay your money, and take your choice >-
>>	Depreciation over 1st 3 years 		- �1,250
>>	Depreciation over next 2 years 9 months - �2,500
    
    Actually it cost:---------------------------------------------v
    
    June 84 Bought a pug 205  1.3gr for		�4750		�4,750	
    
    June 87 traded in Pug for			�3500
    Depreciation over 1st 3 years           - 		�1,250
    June 87 bought ex-demo 2.EFI MG Maestro     �7000	
    				diffence paid		�3,500
    				total cost			�4,750 
    
    March 90 traded in Maestro			�4500
    March 90 bought ex-demo 2.0gti Montego	�9000 
    Depreciation over next 2 years 9 months -		�2,500
    March 90 bought ex-demo 2.0gti Montego      �9000	
    				diffence paid 		�4,500
    				total cost 			�7,000
    
    total PURCHASE cost over 6 years 				�16,500
    
    plus insurance,		200/year?		�1,200		
    plus road fund licence,				  �500
    plus servicing, 	twice a year, say 100/year?	  �600
    plus consumables such as brake pads, tyres, 
    exhausts etc... 		�100/year?		  �600
    plus you could always get a mechanichal mishap 	�?????
    								�19,400
    (if you are not lucky enough to have ready cash, 
    you would also be paying interest on this!)
    Ok, you've got maybe �5000 trade in collateral 
    on the car you have currently,				�14,400
    you pay income tax on this so (even at base rate)		�19,200
    
    which is 					�3,200 per year
    
    And you haven't even considered replacement cars whenever yours is off
    the road.... 
    
    You CAN make savings....but it's NOT as cheap to run your own car as
    you make out. 
    
    Each time I calculate the costs, then decide the difference in cost is
    worth the peace of mind it bring. (if it breaks, fix it, cost doesn't
    worry me!)
    
    Richard

Purchase costs over 10 years (2 Volvo 240's)	12,850

Insurance and road tax				 3,000
Tyres (4 sets)					   600
Exhaust system (1: stainless, lifetime guarantee)  145
Oil/filter every 6 months			   450
Other fixes - replacement clutch at 62,000 miles   230

Bank interest charges (let's be fair!)		 2,000

	Total costs				19,275

	Car sold for				 2,300
	Initial equity				 2,500

	Net cost over 10 years			14,475

			= slightly under 1500 a year

Now, even a major breakdown requiring an engine replacement *twice* during the
10 years would add less than 400 a year to the costs.  I guess I left out bits
and pieces like replacing brake shoes (four times I think) at 50 a time, and
light bulbs blowing and so on, but it's still cheap.  Oh yes, the first Volvo
was 2 years old when I bought it and the second one was brand new.  I woudln't
have sold it if we hadn't moved, which would have brought the annual cost down
even further.

Now, if "peace of mind" is worth almost two grand a year to you, then you spend 
your money that way.  Not me.

	Brian

	This looks like double addition to me, in simple terms.......

	I paid               �4750 for the pugeot
	I paid the pugeot  + �1250 for the Meastro
	I paid the meastro + �4500 for the Montego
	This will take me to December 92 - that will be 8.5 years	

     total amount of money I have paid out = �10,410  not  �16,000
    
>    plus insurance,		200/year?		�1,200		
     my pugeot 1.3 was never more than �90 a year
     my meastro and Montego were never more than �200   �270+�1200= �1470 
     (what can I say, I was over 30 when I joined DIGITAL, with 60%, and female,
      and protected no claimes - just-in-case)

>    plus road fund licence,				  �500
******1 year came with the Pugeot, 6 months with the Montego and
      Mestro, and I got the refund when I traded in
						9 years  =�570

>   plus servicing, 	twice a year, say 100/year?	  �600
*** I only do 10,000 a year, and servicing is every 12,000 miles or 12 months.
*** My friend does the servicing, so 8.5@ �50             �450

    plus consumables such as brake pads, tyres, 
    exhausts etc... 		�100/year?		  �600
****  I have not had to replace tyres, exhaust,....etc    �000

    plus you could always get a mechanichal mishap 	�?????
***   no mechanical mishaps, and I have full warenty anyway.  �0000

    								�19,400

				Nope, not �19,400, but �12900 for 8.5 years

>    (if you are not lucky enough to have ready cash, 
>    you would also be paying interest on this!)

	I did have ready cash, this was one of my aims when I went to contract
	in the states - I would bring back enough cash so I would NOT be saddled
	with a car loan.

>     Ok, you've got maybe �5000 trade in collateral 
>     on the car you have currently,				�14,400

     By the end of the 8.5 years, I'll be very hard on myself and say and say 
     the 2.0GTI with 30,000 miles and 3 years old, and with inflation, will get 
     �3,400 trade in 

		�12900  less  �3400    = �10,500
	
>   you pay income tax on this so (even at base rate)		�19,200    
>    which is 					�3,200 per year
 
	I'm not sure what you're saying I pay income tax on. If you're saying
	because I take the cash, instead of the car, the cash is about �2900,
	(I'm not sure exactly what the car suplement is), however, I don't get 
	the income tax hit for a 2litre car with less than 2,500 business 
	miles, so this evens out.

>    And you haven't even considered replacement cars whenever yours is off
>    the road.... 

	My car was off the road for 1 week, it did not cost me anything extra.
    
>    You CAN make savings....but it's NOT as cheap to run your own car as
>    you make out. 
 
		�10,500 over 8.5 years - �1235 a year   

>    Each time I calculate the costs, then decide the difference in cost is
>    worth the peace of mind it bring. (if it breaks, fix it, cost doesn't
>    worry me!)
	
	That's what warrenties and insurance are for.
    
	You make your choice, I make mine.

	Heather

    OK, I did take a bit of double accounting.... :-)
    
    But so have you,
    >>     I paid               �4750 for the pugeot
    >>     I paid the pugeot  + �1250 for the Meastro
    your words were    
    >>    June 87 traded in Pug for                   �3500
    >>    June 87 bought ex-demo 2.EFI MG Maestro     �7000
    
    !                        diffence paid           �3,500
    so total was more  
    
>   plus servicing, 	twice a year, say 100/year?	  �600
>>*** I only do 10,000 a year, and servicing is every 12,000 miles or 12 months.
>>*** My friend does the servicing, so 8.5@ �50             �450
    
    Thought correct service intervals were 6000 miles or 6 months , but I
    may have been wrong
    
>>    plus consumables such as brake pads, tyres, 
>>    exhausts etc... 		�100/year?		  �600
>>****  I have not had to replace tyres, exhaust,....etc    �000

    30,000 miles without changing tyres, good driving!, but what about
    brake pads?. You must have used some of these....
    
    >>  My car was off the road for 1 week, it did not cost me anything
    extra.
    Did your warrantee or breakdown insurance supply a car?
    Isn't it off the road when it gets serviced? 
    
    I know, we all have different circumstances, drive different miles,
    don't all have friendly mechanics and don't want to DIY service...
    But the figure IS higher than your first AND second estimates!, so even
    you didn't realise how much it was ACTUALLY costing!.
    
    Richard

>    Isn't it off the road when it gets serviced? 


It's also off the road when in any Digital car park!  So it might as well be
serviced instead of sitting in a Digital car park ....

If you ever work out the REAL costs of running a car, either leased or owned,
you'll get a shock.  But few people run a car based on real costs, which is
why not many people run the cheapest cars as analysed to death by the AA 
regularly.  FWIW, I reckon my Volvos worked out at around 50p a mile over the
10 years.  Cheaper to use taxis for the local journeys - about 30p a mile -
and hire cars for the holidays (using Digital corporate rates, of course),
but I still ran my own car, and even had one for the spouse, and an E-type
for fun, and .....   Heck, I could have bought a Bentley Mulsanne Turbo with
what I've spent on chunks of metal, plastic and leather over the last 20 years.
Enough!  I now run A car based on personal need, rather than a swelled head.
On the other hand, I'm buying an aeroplane .... :^)

Brian

>    OK, I did take a bit of double accounting.... :-)
>    
>    But so have you,
>    >>     I paid               �4750 for the pugeot
>    >>     I paid the pugeot  + �1250 for the Meastro
>    your words were    
>    >>    June 87 traded in Pug for                   �3500
>    >>    June 87 bought ex-demo 2.EFI MG Maestro     �7000
 
	Opps yup, my arithmetic wasn't too hot here I'm �2,000 out, over the
	8.5 years, so I pay an additional �235 a year to my previous figure.
    
>    Thought correct service intervals were 6000 miles or 6 months , but I
>    may have been wrong
 
	Nope, I checked the book again, 12,000 or 12 months.
   
>    30,000 miles without changing tyres, good driving!, but what about
>    brake pads?. You must have used some of these....
 
	I presume they're changed in the servicing, but I never pay more than
	�50, I don't ask what he does, I wouldn't understand if he told me!
   
>    >>  My car was off the road for 1 week, it did not cost me anything
>    extra.
>    Did your warrantee or breakdown insurance supply a car?
>    Isn't it off the road when it gets serviced? 
 
	My husband and I have 3 cars between us, we usually only drive the
	NG TC at weekends - it's such fun - and I don't like the wet-weather
	gear much - I drove that whilst the Montego was off the road.
	The servicing is usually done at the weekend, but it wouldn't matter,
	we still have two other cars.
   
>    I know, we all have different circumstances, drive different miles,
>    don't all have friendly mechanics and don't want to DIY service...
>    But the figure IS higher than your first AND second estimates!, so even
>    you didn't realise how much it was ACTUALLY costing!.
 
	I know I put �200 a month in a Building Society, (it was �90 when I
	had the pugeot) with this I pay everything to do with the car, 
	including the upgrade to a new model, and I also pay for my main
	holiday from this each year. (Canada this year).

	How much exactly it costs for the car I don't care much, what I 
	care about is that it is a much better deal than the lease scheme.

	Heather