Should you treat your car as a private motor or a company vehicle ? Deciding whether to treat your car as a business vehicle has many financial implications, including tax .

The costs of running a car far exceed the initial outlay and any car finance or personal loans attached to the vehicle. For instance, car insurance can be expensive. When it comes to the company/private question, commercial vehicles can attract higher insurance premiums. Car insurance is an extra expense that many people do not factor in, but recent studies have shown that women can save money on their car insurance policies.

Road tax and breakdown cover are another expense, although these do not adjust for company/private vehicle ownership. Some experts advise that the cheapest way to run a car is on a private basis, but to charge the Inland Revenue approved mileage allowance when using the car for business. Money paid on annual business mileage is not subject to income tax or national insurance contributions.

Depending on your individual circumstances, the type of car you drive, any outstanding car finance and how many miles you do, this situation can vary. It is always worth discussing financial and tax-related queries with an accountant .