I think catastrophic depreciation is the right way to put it. No other manufacturer has done this.
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Crazy low residuals?
- Thread starter pdk42
- Start date
Some good news today with regard to used values. Hopefully we are over the worst of it and things continue to improve. Hopefully Tesla will be offering decent trade in values later this year/early next year with perhaps further price drops on the new refreshed Model 3 and Model Y and lower APR rates to encourage current owners to stay with the brand otherwise
There is no requirement for a car to be new when brought by a limited company, buying a 2nd hand car in a limited company just changes when the company pays tax.
Rooster6655
Active Member
Only has to be new for first year 100% claim against tax, you can still buy used its just the way you account for it over time.
The thing to watch for would be the BIK on a used car as you have to pay it based on the original price in most cases, I hate paying BIK on the Model Y never mind a 120k used Model X!
Which would be 2% of 2400 and then 20/40% of that depending on your bracket? Which is 480/960 a year?
If you discuss EVs with ice drivers one of the first arguments they give is that EVs are not affordable to the average family....now that the used prices start to fall...its the EV owners complaining. In all honesty, if this electric car revolution takes place then early adopters are going to have to take a hit
Jason71
Well-Known Member
The mantra for years has been "price parity with ICE by (insert date here)"
So its not like we wernt warned.
I just didn't realise that was also going to apply to the cost of fuelling it!
I agree...the electricity price is a killer. Now, if the Government raised the price of fuel significantly so it can subsidize electricity...would we be happier ?
What the percentage of tesla owners with free supercharger. Its prob really low. Isnt there a clause that gives a certain amount of supercharging and it isnt actually unlimited usage for the year
Yes i think owners would be happier if eleccy or supercharging is subsidised
Sean.
Active Member
Company cars
As an individual you pay 2% bik irrespective of new or used.
The company will pay more corporation tax in the the first year if the car is not new because it can;'t write off the whole amount of, but it can still depreciation the asset. However the company will also be able to depreciate the asset in year 2 etc if they didn't take the 100% FYA, and with CT rates going up, the saving will be more in those later years than the saving in year one.
At the end of the day the company can only write off the depreciation of the car, so when they sell the car, if the 100% FYA was used, the whole proceeds from sale will be effectively profit, and taxed at the prevailing rate. From April it rises by up to 6%. If the car ultimately sells for say £30k, the company could pay up to £2k more CT tax if they took the 100% FYA allowance before April. (it gets more complicated as it depends on profit levels., but the rate will be the highest rate you pay as a company at the time as its increasing the profit in that year)
If anything, I'd say there is a stronger argument for buying used at the moment if the company can afford the cash, because taking all the tax benefits when the taxation is lower and giving some back when the taxation rates are higher is an expensive way to do it.
As a company owner, how and when you pay yourself out of the company is a different thing.
As an individual you pay 2% bik irrespective of new or used.
The company will pay more corporation tax in the the first year if the car is not new because it can;'t write off the whole amount of, but it can still depreciation the asset. However the company will also be able to depreciate the asset in year 2 etc if they didn't take the 100% FYA, and with CT rates going up, the saving will be more in those later years than the saving in year one.
At the end of the day the company can only write off the depreciation of the car, so when they sell the car, if the 100% FYA was used, the whole proceeds from sale will be effectively profit, and taxed at the prevailing rate. From April it rises by up to 6%. If the car ultimately sells for say £30k, the company could pay up to £2k more CT tax if they took the 100% FYA allowance before April. (it gets more complicated as it depends on profit levels., but the rate will be the highest rate you pay as a company at the time as its increasing the profit in that year)
If anything, I'd say there is a stronger argument for buying used at the moment if the company can afford the cash, because taking all the tax benefits when the taxation is lower and giving some back when the taxation rates are higher is an expensive way to do it.
As a company owner, how and when you pay yourself out of the company is a different thing.
For the cars with free SC it is unlimited and stays with the cars forever. When SC costs were cheap it wasn't worth much, but these days (and going into the future) it's a reasonable amount. Our European road trips would cost £500-600 in SC costs if we didn't have free usage- If we had to pay we would probably just fly. Let's not forget DC rapid chargers costs aren't taxed to anywhere the level of petrol at present, so future DC rapid charging costs are only going one way.
Tesla are also honoring the free status even after battery swaps, I cannot see us selling our car for a long time to come party because of the free for life fuel. The fact Tesla keep on adding SC sites is making the unlimited SC more and more usable.
There are a handful for used AP2.0 equipped S/X cars delivered between Dec 2016 and end of March 2017 that have transferable free for life SC. If you find one of those 'cheap', they are a very very good used buy.
Rooster6655
Active Member
Negative being of this is you will have an old car driving around whilst new models are updated with better features (non updatable via OTA)
Not sure what that's a negative? Vast majority of people don't drive around in new cars, and given all the moaning about no parking sensors on the new Teslas am pretty happy with our X. Ofcourse the mythical v11 of FSD if it ever comes to the UK will work just as badly on our car as any new car Tesla is delivering in the UK today.
Ofcourse the other massive advantage of keeping a car long term is residuals have little to no relevance to me
.You need to remember that all the recent trade buyers have been killed by the drop in prices so the offers they make reflect that trauma. They just don’t want to buy them.
The little game where you could basically get a new Tesla every 18m for zippo was always going to end. I’m just happy I managed to drive two for three years without any depreciation, I now have plenty in the back pocket to cover what happens to the residuals on this (final) one.
If you bought my last one, for more than I paid for it, at least you are driving a car with comfortable suspension!
The little game where you could basically get a new Tesla every 18m for zippo was always going to end. I’m just happy I managed to drive two for three years without any depreciation, I now have plenty in the back pocket to cover what happens to the residuals on this (final) one.
If you bought my last one, for more than I paid for it, at least you are driving a car with comfortable suspension!
Value by Motorway £42100 today. I am thinking of cutting my losses soon and selling the car unless someone thinks there could be a recovery or a price rise by Tesla?. I do know the facelift Model Y will be released October 2024 so i will need to sell by summer 2024 latest.
PITA
Model 3 Performance
Am I the only one wishing for the prices to plummet?
I bought my Tesla in 2021 MiC for £61,000 using my Company profits.
It's currently being used as a Company Car, paying 2% BIC Tax.
In a years time it'll be 3 years old, so if it's worth £20k ... I'll buy it off the Company as a private car, pay the Corp Tax balance... and just keep driving it.
Musk said the battery and motors are good for the lifetime of the car. So just drive the thing.
Plugged into our home Tesla eco-system with cheap electric, it should be setup now for some time.
I bought my Tesla in 2021 MiC for £61,000 using my Company profits.
It's currently being used as a Company Car, paying 2% BIC Tax.
In a years time it'll be 3 years old, so if it's worth £20k ... I'll buy it off the Company as a private car, pay the Corp Tax balance... and just keep driving it.
Musk said the battery and motors are good for the lifetime of the car. So just drive the thing.
Plugged into our home Tesla eco-system with cheap electric, it should be setup now for some time.
Jason71
Well-Known Member
I am in the same position and it does take the sting out of the depreciation compared to private buyers but its still a loss on balance.
