When we run our own business, that generally means we’ll need to buy our own supplies. In many cases, one of those supplies ends up being a company vehicle.
There are certain times when it makes sense to buy a company car for you or your employees. If your business requires a lot of driving, then it may not seem right to put all that wear and tear on a personal vehicle, when a company vehicle is also an option. Some companies deliver merchandise that can’t easily fit into a typical sedan. A company car can also be used as a way to advertise a business, but only in certain circumstances.
Tax Implications
Most business owners figure out pretty quickly that running their own show means having to think more about tax implications than people who work in an office owned by someone else. A company car can act as a tax deduction, but only if good records are kept. That means keeping track of where the car goes, why the car is going there, and how far it traveled to get to its destination. Giving employees an auto allowance to reimburse them for expenses is not considered a taxable benefit, but only if the allowance is done in a certain way. Basically, if you’re thinking of getting a company car, you need to talk to your business accountant first. They can walk you through all the pros and cons in a way that ensures you won’t get an unpleasant surprise come tax time.
Researching Options
We should always research vehicles before we buy. That’s especially true when we’re considering company vehicles. Let’s say you’d prefer to buy a certain brand of car for your business. If it’s Ford, then do some basic new Ford vehicle research. You may decide a used car works better, but it’s a good idea to start with new vehicles and work your way backwards from there, if necessary. Many of us don’t care if we drive around a junker, as long as it gets us where we need to go. However, a company car represents our livelihood. We wouldn’t want to wear run-down company uniforms, and we don’t want to drive around in run-down company cars, either.
Remember that there are some businesses that you may not want to advertise as loudly as others. If you run a legal cannabis shop, it may seem like a good idea to get a custom car wrap that shows off your company logo and contact information.
However, you should talk to your attorney specializing in cannabis law first, to make sure you don’t run afoul of any local advertising regulations. For instance, Washington state prohibits marijuana ads on both public transportation and company cars.
It’s easy to think of marijuana as normal, if you live in a state where lawmakers are handing out pot shop licenses. However, selling marijuana is not the same as selling books or tractors. There are certain restrictions on alcohol advertisements. There tend to be even more on marijuana advertisements, possibly because alcohol is legal on a federal level, and marijuana is not.
