Company Car Allowance Screwing

[Kosmik]

We'll have to agree to disagree on this one.

I am of the firm opinion that if a company gives you X amount to spend on a car, they have the right to give you a range of cars to pick from, and this is really what it's all about.

They give you the cash for a Polo Vivo and you use it to go towards a BMW 320 +++ they should have the right to tell you that you have overstepped the mark, and it's got nothing to do with being a nanny and everything to do with the average car allowance and what the company allows you to buy.

Certainly the company can set a recommended car per allowance level but if a person buys a car of higher value, that is their choice and responsibility. Financing responsibly is up to the individual and the finance institution, not the company.

 

[Ancalagon]

We'll have to agree to disagree on this one.

I am of the firm opinion that if a company gives you X amount to spend on a car, they have the right to give you a range of cars to pick from, and this is really what it's all about.

They give you the cash for a Polo Vivo and you use it to go towards a BMW 320 +++ they should have the right to tell you that you have overstepped the mark, and it's got nothing to do with being a nanny and everything to do with the average car allowance and what the company allows you to buy.

But then how far do you take it? I mean, my salary pays for everything I do - my car, my house, my cellphone, my booze, my going out, my food, my everything. Should my company be allowed to dictate to me how much alcohol I drink on weekends? Or what food I eat, so that I am full of energy at work? Or should they be able to tell me to be in bed no later than 10PM?

They pay for everything - by your logic, they can tell me how to use my money so that I dont use it irresponsibly.

And lets say that the boss had a real concern that the OP was buying something he could not afford. If that were me, I would sit him down and explain the financial implications, and show him how it could be a bad idea. But I would leave the decision up to him. Just changing the rules to make what he wants to do impossible, but not explaining to him why it is a bad idea, is just poor management. Now even if management had good intentions, they handled it so badly that he resents them for it.

 

[Skywalker786]

I don't get that either.

Usually a car allowance forms part of your total package and how you structure that within the package is up to you (up to a certain percentage of your total package). The age, financing of the vehicle, insurance etc is not the companies baby (some companies will have group scheme insurance arrangements which lowers the insurance costs due to 'bulk buying'). How you work the tax out based on your allowance, vehicle price & milage travelled is between you and SARS.

+1

I do not see why the company should require to see a copy of the finance agreement, or interfere in your finance decision making.

 

[bwana]

The way I see it is that if the company is giving you money for a specific purpose they're free to attach whatever T&Cs they want. If you don't want to accept those conditions don't take the money.

 

[MKFrost]

I take note of what has been said but have to agree that it has nothing to do with the company.

I can understand them being 'responsible' and all but what's going to be next... forcing employees to submit their monthly budgets to ensure that they spend their salaries wisely each month?

The allowance is part of the total cost to the company. If it is such a concern for the company then take the allowance away and buy each employee a bloody Toyota Corolla.

 

[Fazda]

The way I see it is that if the company is giving you money for a specific purpose they're free to attach whatever T&Cs they want. If you don't want to accept those conditions don't take the money.

^^^This.

That is what I was trying to say all along, and the OP actually agreed with me about 20 posts back.

Let's just say that your salary is R 20k per month, and SEPARATE from that the company gives you R 5 000 to spend on a car - the 5 k is money that they have specifically set aside for the car and nothing to do with your salary, surely they have a right to know how you intend spending that money? As I've said before, I can structure a deal to come out at exactly 5 k, BUT I have a massive residual attached to it...........surely they need to know, and hopefully advise you not to be a bloody fool?

 

[Ancalagon]

^^^This.

That is what I was trying to say all along, and the OP actually agreed with me about 20 posts back.

Let's just say that your salary is R 20k per month, and SEPARATE from that the company gives you R 5 000 to spend on a car - the 5 k is money that they have specifically set aside for the car and nothing to do with your salary, surely they have a right to know how you intend spending that money? As I've said before, I can structure a deal to come out at exactly 5 k, BUT I have a massive residual attached to it...........surely they need to know, and hopefully advise you not to be a bloody fool?

But why? Why does it matter if you are a fool?

 

[Fazda]

But why? Why does it matter if you are a fool?

If you look back to my previous comments, you will see that I was talking about a company with some sort of social responsibility and it should concern them if an employee is getting himself into crazy debt BECAUSE of their car scheme.

We are obviously never going to agree on this, so let's just leave it at that.

 

[KalMaverick]

Let's just say that your salary is R 20k per month, and SEPARATE from that the company gives you R 5 000 to spend on a car - the 5 k is money that they have specifically set aside for the car and nothing to do with your salary, surely they have a right to know how you intend spending that money? As I've said before, I can structure a deal to come out at exactly 5 k, BUT I have a massive residual attached to it...........surely they need to know, and hopefully advise you not to be a bloody fool?

Except it can never really be considered separately can it? You are providing a services and in exchange you are getting remuneration, remuneration that you will get fully taxed on as normal.

It's not just free money the company is paying out the goodness of their hearts. It's part of your package.

I've got to agree that I don't see how it's any business of the company what you do with your own salary past the normal requirements of amount/age.

 

[shooter69]

The way I see it is that if the company is giving you money for a specific purpose they're free to attach whatever T&Cs they want. If you don't want to accept those conditions don't take the money.

+1

 

[Ancalagon]

If you look back to my previous comments, you will see that I was talking about a company with some sort of social responsibility and it should concern them if an employee is getting himself into crazy debt BECAUSE of their car scheme.

We are obviously never going to agree on this, so let's just leave it at that.

But what makes this different to me buying a car with my own salary without a car allowance? If I wanted to, I could go get an M3 with a 50% balloon payment. Theoretically. Its still irresponsible and will still land me in debt that I probably couldnt afford. If the company should prevent such a deal out of social responsibility, why not do it even when you dont have a car allowance?

So in summary:
With car allowance: Not allowed to make stupid decisions, company still pays for car which you need for work.
Without car allowance: Do whatever you like, company still pays for car which you need for work.

Why does a car allowance change that fact?