company vehicles

Kent

We are primarily a sales organization and have many company vehicles. We also have a wide array of policies pertaining to personal use of these automobiles. Do any of you have similar policies? Do you charge an annual or monthly fee for persoanl useage or just have the EE determine personal mileage at the end of the year? I'm trying to unify the various policies and be fair to all involved. I'd appreciate your feedback.

marc

While you are contemplating all of these issues, you should also know that the IRS has some requirements about recognizing personal use in the ees W-2 form if you do not have some other way of capturing it.

San Francisco

Those with leased vehicles must maintain a mileage log denoting business and personal travel. They are charged back for the personal use which is usually deducted from his/her bonus - so it is quarterly. A new policy is being considered whereby only those whose travel exceeds 12,000 miles a year will be entitled to a leased vehicle - unless of course you are a very senior executive.

Elizabeth

Don D

If I were faced with this same 'challenge', my first thought would be that this is an accounting function, a policy that should be drafted by the Comptroller or a tax accountant in the business. I would agree that HR could perhaps finalize and disseminate the policy after those with the tax/income knowledge draft it.

I guarantee you that if you do crank out a policy on this from HR, you'll have more than a few people in accounting and other departments shooting holes in it. It is also proven that 70% of your outside sales staff are weekend tax lawyers with all the knowledge and they'll offer up tons of criticism of your policy.

I really believe this is not one HR should tackle.

San Francisco

Per Don, this is not a function of our HR department - it's just how it works in our company.

Elizabeth

Pork

Kent: Been there and done that, I prefer my current companies' method of calculating the value of the company car and with pre-calculated personal use miles, which are based on my best guess and record keeping on my part. However, I have been reading some news letters that say that next year that method was going by the way side and a monthly log may have to be turned in which shows our daily use for personal use such as travel to work and home and any meal travels that are not job related! The accounting department will have a program to tell payroll the "value added" and weekly our gross earnings will have to include the personal use value figure and income taxes calculated, accordingly. If your company is on a bi-weekly or monthly payroll system then the calculations will be based, accordingly, to your payroll system. I do not wish to be the keeper of that "dawg" and I'll run from it as long as I can. The emotions around "vehicle perks" and "company required vehicle FOR WORK" is a hidden nightmare, named "JASON". I OFTEN SEE VEHICLES IN THE AREA DRIVING AROUND OR PARKED AT SOMEONE'S HOME AND YET NO PERSONAL USE LOG HAS EVER BEEN KEPT! Even the mechanic that has a company vehicle to go to the down vehicles on the road has got to be keeping a vehicle log and his trips to home and to work when not on a call become income generating and he/they have never been told.

Good luck , but run from the this "keeper responsibilities" if you have a chance.

PORK