Company cars offer your employees a lot of benefits. For instance, if public transportation is not easily accessible, it can help them get to work on time. From the price of new cars to taxes your employees pay for using a company vehicle, there are perks and downsides to providing a company car to employees. Here are the good and bad associated with providing company cars.
Company cars make transportation easy
They make remotely located companies accessible, thus increasing productivity because they can get to the office efficiently and on time. For instance, if your company goes for jobs outside the office, it’s easy and convenient, especially if there are types of equipment involved.
Providing a car is beneficial to employees
Public transport is a hustle and unreliable, mainly if the company location is remote. It benefits employees who use public means of transportation to get to work early hence saving a lot of time. Company cars allow flexibility to employees with families because they can use them for personal shipping.
Helps control your corporate image
Vehicles play a significant role in how brands are perceived. For instance, going into a meeting with old cars shows how unsuccessful a company is, whereas if you show up with a luxurious vehicle may show the success of your company.
Company cars come with extra costs
Investing in company cars could be an additional expense if your company’s location is close to public transportation or most of your staff own vehicles. There are many costs involved in servicing and maintaining company cars. Car leasing companies can help to cut down the cost of buying cars now and then.
Insuring a fleet of company cars can be expensive. It’s important to remember to replace them after a certain period, and this is an extra expense for your business.
Employees face extra tax for using company cars
The provision of company cars has a lot of benefits, such as making it easier to access the office and home after work and reduction of employee’s income taxes. Staff using company cars are required to pay taxes according to the total value of the vehicle and its transmission.
Increased risk and liability
If you are providing company cars to your employees, you should set guidelines when using them. If employees are driving vehicles for business or personal use, they should abide by specific rules and, if possible, sign an agreement. Whenever they are behind the wheel, they should have a valid driving license. They should not drive drunk or use their cellphones while driving. It goes without saying that they should observe traffic rules and regulations.
Vehicles provided by companies have their advantages and disadvantages. You should always find out how to maximize the benefits while minimizing the challenges. It’s essential to have company policies in place that promote safe driving ensures a cost-effective plan for your employees and company. Whether you choose to lease a car or not, these rules and regulations will save you and your company a lot of headaches.