# using company car for private purposes



## slavek

Dear forum members,

I've been offered the job in Brisbane (A$130k) and a company car as part of the salary. Please, can you advise if it is worth to use it for private purposes and if so how much I'll need to pay?

Many thanks in advance
Slavek


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## consensual

I doubt the information published in this forum. There is a lot of scam around. Please be realistic when you want to migrate to Australia.


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## aussiesteve

slavek said:


> Dear forum members,
> 
> I've been offered the job in Brisbane (A$130k) and a company car as part of the salary. Please, can you advise if it is worth to use it for private purposes and if so how much I'll need to pay?
> 
> Many thanks in advance
> Slavek


Hi
If a company car is offered as a part of the salary then you pay nothing, however there may be some fringe benefit tax implications for you.


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## slavek

consensual said:


> I doubt the information published in this forum. There is a lot of scam around. Please be realistic when you want to migrate to Australia.


Realistic about what?
Saying A$130k I mean 130000 Australian Dollars per year before Tax. 
What have you understood?


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## slavek

aussiesteve said:


> Hi
> If a company car is offered as a part of the salary then you pay nothing, however there may be some fringe benefit tax implications for you.


This is what I am struggle with. How much is that and how to calculate it?

You see over here in the UK it;s quite easy to calculate and it make sense to have a company car where for instance in the Netherlands it is too expensive.


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## slavek

And one more thing because I'm getting confused - it you say you wage on the forum you say the figure before or after tax?


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## aussiesteve

slavek said:


> And one more thing because I'm getting confused - it you say you wage on the forum you say the figure before or after tax?


To answer the first question, the value of the vehicle may be taken into account when calculating your Medicare levy, which is only 2,% and I say maybe as depending on how the car is used in total will decide how much is deemed private use and therefore taxable.
All salaries in Australia are shown as before tax.
An important thing to find out is your employer sponsoring your visa or do you have to do that yourself.


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## slavek

aussiesteve said:


> An important thing to find out is your employer sponsoring your visa or do you have to do that yourself.


My current company is opening a new branch in Brisbane and the new branch will sponsor my 457 visa.

We did some calculations and we got to conclusion that A$130k + car sound fair. Do you agree?


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## Mish

slavek said:


> My current company is opening a new branch in Brisbane and the new branch will sponsor my 457 visa.
> 
> We did some calculations and we got to conclusion that A$130k + car sound fair. Do you agree?


It all depends on what the job is and hours etc. Also does it include Super? Some salaries will include salaries and some will not.

The ATO considers the vehicle for private use if it is garaged and your house overnight and is subject to FBT. However, most employers will have taken this into account and reduced your package by that amount. It is always best to check with your employer.


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## slavek

It will include super. I'll work from home office for start and then we will setup the proper office. I'm computer programmer but part of my duties will be to deal with key customers


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## aussiesteve

slavek said:


> It will include super. I'll work from home office for start and then we will setup the proper office. I'm computer programmer but part of my duties will be to deal with key customers


Hi
It sounds ok, about double the average wage here, but as others have said it depends on the hours you will be working etc.
The cost of living here is high but the salary will be sufficient.
When are you planning to come ? I live in Brisbane and the next few months can be trying weather wise for those who are not used to it. The rest of the year the weather is great.


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## slavek

aussiesteve said:


> Hi
> It sounds ok, about double the average wage here, but as others have said it depends on the hours you will be working etc.
> The cost of living here is high but the salary will be sufficient.


I'm going to work, 35-40 hours per week excluding lunch breaks.

How many hours per week is standard for office work in Australia?


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## Mish

aussiesteve said:


> When are you planning to come ? I live in Brisbane and the next few months can be trying weather wise for those who are not used to it. The rest of the year the weather is great.


Bahahahaha. That is so true. Alot of people struggle with the humidity. For me I am use to it so doesn't phase me. My husband said it is hotter than Egypt!


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## Mish

slavek said:


> I'm going to work, 35-40 hours per week excluding lunch breaks.
> 
> How many hours per week is standard for office work in Australia?


That is about right. I work full time and work 36.75 hours per week.

If you want to check your pay you can always check the rates for your award on fair work Australia website that will give you a general idea if what they are paying is correct for your occupation.


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## slavek

I'm negotiating final conditions next week so I need to know if it is worth to use company car for private purposes or better to have a second car?


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## slavek

I was meaning the FBT? How to calculate it?


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## consensual

Let me re - iterate my point. If you are offered 130k package including a car which other professionals are dreaming about then good on you. BUT what I am trying to say is this forum itself is trying shit hard to paint a good picture about the already bad situation here in job market. 
It is an exploitation to try to get people into Australia without them knowing the real situation that they will be facing.


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## aussiesteve

slavek said:


> I was meaning the FBT? How to calculate it?


You don't pay FBT your company does.


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## slavek

Is that means I'll all these benefits for nothing? In the UK you have got different tax band which means you have got lower tax free allowance.


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## aussiesteve

slavek said:


> Is that means I'll all these benefits for nothing? In the UK you have got different tax band which means you have got lower tax free allowance.


That's right, it would only come into play when working out the Medicare levy ( should you have to pay it) which is only 2% anyway. It is also taken into account when assessing welfare and child assistance payments however you basic income is well above the eligibility threshold of any assistance.


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## slavek

aussiesteve said:


> That's right, it would only come into play when working out the Medicare levy ( should you have to pay it) which is only 2% anyway. It is also taken into account when assessing welfare and child assistance payments however you basic income is well above the eligibility threshold of any assistance.


Am I right to say that Medicare levy is kind of helth insurance deduction taken from my wage?


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## aussiesteve

slavek said:


> Am I right to say that Medicare levy is kind of helth insurance deduction taken from my wage?


Yes that's right, I am not sure if 457 holders have to pay it, you will need to check.


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## slavek

Thank you a lot for all your precious answers and patience. I'll come back with new questions as soon as I sign off the contract.


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## slavek

I'm back with my questions. I have found a quite few of tax calculators but none of them has an option to calculate the salary on visa 457. Would please anyone advise me about the accurate monthly salary based on 130k and visa 457?


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## Mish

Taxes are not calculated on the visa you hold they are calculated on if you are a resident for tax purposes or a non resident for tax purposes. As you are a 457 visa holder you would be a resident for tax purposes. 

Next you to work out what your monthly gross income is excluding super. After you have done this you can use a monthly tax calculator on the ATO website to work out how much tax you will pay each month.


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## slavek

130k including 9.5% super...


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## Mish

Approximately $7033 per month net. As long as no other included items in your package that have to be taken out.


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## slavek

Slightly less than suspected. 
Based on all online available tax calculators I was hoping to get something around 7450$

Please, could you post the link to the calculator you've used?


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## Mish

https://www.ato.gov.au/uploadedFiles/Content/MEI/downloads/BUS39410n1007_Tool.xls

Don't forget when calculating you need to exclude the Super figure.


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## slavek

Thank you once again.


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## slavek

Hi there,

I've got the contract, I've got the tickets. I'm still waiting for visa.
In the meantime I'm trying to work out which car would be suitable for mid/upper mid level manager.

In the Europe we do drive BMW but it looks that it might be to posh for Oz. What do you think? What do you recommend?


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## chicken999

Ahu first world problems lol....too many cars to pick from but bmw and Mercedes are still popular with the rich folk here. All depends how much u want to spend. Suv are very popular also check out our own Holden range though they are built offshore now


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## slavek

This is what I mean. We are IT company that dealing with aluminium industry so we don't want to be too posh. On the other hand we want to keep to company standard but we don't want to make impression that we come from Europe and we show up. 

Talking about cars is it better to buy them or liase?


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## Mish

My brother works for a IT consulting firm and he uses a Holden Commodore. I think you would looking at anything mid range.

I imagine lease would be the better option as what I know about them you can get a new one after so many years. Best to talk with an Accountant to which one is better as cara decrease in value as soon as you leave the car yard.


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