Finally leaving my job, and it's just as annoying as I thought it would be
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@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
My point here is, really, that until I actually relocated to another country, I was pretty certain that benefit is present everywhere
We look at something similar for housing. We are considering housing benefits for staff to avoid bigger tax penalties for taxable income.
how does this not related to my above post?
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@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
Why would you get a car working in IT? When do you need to drive anywhere? I don't even need a car to drive to work, let alone anywhere else.
In Israel, it was a standard benefit for all IT related employees. The idea was that anything in IT is considered a creative job, so if you suddenly have a great idea in the middle of the night, you just drive to the office and get to work on it (no remote jobs back in the 90s). The perk stuck around until it got taxed out of existence in 2007-2010-ish.
I've worked a few MSP jobs in the UK and they usually say you have to use your own car. They do pay for petrol though, so if you have a good efficient car you can make some cash on it.
Why would a car come up? Is it because they were doing bench work? In the US, often you get a company car if you are a bench tech.
No. You had to do regular site visits to see the clients and look at what they wanted you to look at, or do regular face to face 'im doing stuff' type work. All things that could be done remote, but just their business model.
That's really an account manager position then. Rather than IT.
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@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
Why would you get a car working in IT? When do you need to drive anywhere? I don't even need a car to drive to work, let alone anywhere else.
In Israel, it was a standard benefit for all IT related employees. The idea was that anything in IT is considered a creative job, so if you suddenly have a great idea in the middle of the night, you just drive to the office and get to work on it (no remote jobs back in the 90s). The perk stuck around until it got taxed out of existence in 2007-2010-ish.
I've worked a few MSP jobs in the UK and they usually say you have to use your own car. They do pay for petrol though, so if you have a good efficient car you can make some cash on it.
Why would a car come up? Is it because they were doing bench work? In the US, often you get a company car if you are a bench tech.
No. You had to do regular site visits to see the clients and look at what they wanted you to look at, or do regular face to face 'im doing stuff' type work. All things that could be done remote, but just their business model.
There are many companies that work this way - and those same companies have an incredible amount of waste. There is likely very little actual value in those visits other than glad-handing. Now, if you're charging those clients full rate for all the drive time and glad-handing, more power to ya.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.That's not what he means. He means that it is a way to get benefits into the hands of the employees without paying so much taxes on those benefits.
Let's be extreme and assume 100% taxes (no one is this high BUT...)
Salary: $10K / mo + $10K tax = $20K per month from the employer
Salary: $7K/mo + $7K tax + $3K/car/housing benefits = $17K per month from employer
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
This is simply not true.
OK, you obviously know more about it, never having been there or seeing that situation first hand
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
Why would you get a car working in IT? When do you need to drive anywhere? I don't even need a car to drive to work, let alone anywhere else.
In Israel, it was a standard benefit for all IT related employees. The idea was that anything in IT is considered a creative job, so if you suddenly have a great idea in the middle of the night, you just drive to the office and get to work on it (no remote jobs back in the 90s). The perk stuck around until it got taxed out of existence in 2007-2010-ish.
I've worked a few MSP jobs in the UK and they usually say you have to use your own car. They do pay for petrol though, so if you have a good efficient car you can make some cash on it.
Why would a car come up? Is it because they were doing bench work? In the US, often you get a company car if you are a bench tech.
No. You had to do regular site visits to see the clients and look at what they wanted you to look at, or do regular face to face 'im doing stuff' type work. All things that could be done remote, but just their business model.
There are many companies that work this way - and those same companies have an incredible amount of waste. There is likely very little actual value in those visits other than glad-handing. Now, if you're charging those clients full rate for all the drive time and glad-handing, more power to ya.
Low cost account managers do this, high cost IT pros would need to be doing IT work. If IT is acting as account managers you likely have major problems. One in that you can't hire effectively, two in that you have to pay really high rates for no work being done, three that you have a skill mismatch as IT people are rarely good account people or vice versa.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.You are missing the point. It's not profit vs. lease. It's salary vs. lease.
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@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.That's not what he means. He means that it is a way to get benefits into the hands of the employees without paying so much taxes on those benefits.
Let's be extreme and assume 100% taxes (no one is this high BUT...)
Salary: $10K / mo + $10K tax = $20K per month from the employer
Salary: $7K/mo + $7K tax + $3K/car/housing benefits = $17K per month from employer
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
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@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.You are missing the point. It's not profit vs. lease. It's salary vs. lease.
Is that right @dyasny was this about salary+benefits? Or was it about the company simply paying less taxes on taxable profits?
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@DustinB3403 I see. And there is no compensation involved? Some countries I worked in, if you are sacked, you get compensation, but if you decide to leave, you get nothing
In the UK it depends. If you are sacked due to gross misconduct you wont get any money. If you are made redundant, you will get a set amount based on length of employment (could be more, but by law its at least that set amount), and if you take voluntary redundancy, you get a package as setup by the former employer... so, it depends.
If you signed a contract for 3 months notice, usually you can negotiate to leave early if you really want. "Im going to give two months". But, if you just walk out you didnt mean your contractual obligations and that could have ramifications.
In the US, one is called being fired and one being laid off. Laid off = made redundant.
Yep, here being laid off will see you get redundancy pay, being fired wont (unless you have a special contract).
In the US, if you are laid off (made redundant) you can apply for unemployment benefits. This is a state level thing, all companies that have employees must pay into the unemployment benefit plan. this pool of money is used to help keep people afloat while they look for new work.
you can even apply to get this if fired or you quit, but it changes how long until you become eligible for those benefits.Here, its all by the company by law, not related to the the government paying anything. Official wording:
"You'll normally be entitled to statutory redundancy pay if you're an employee and you've been working for your current employer for 2 years or more. You'll get: half a week's pay for each full year you were under 22. one week's pay for each full year you were 22 or older, but under 41"
What happens if the company goes under and they aren't around to pay?
oh - well over there - there are probably some protections that magically pull money from somewhere to pay them.
Sort of. If a company goes under and is bankrupt, assets the company owned are sold and the sum is put towards all employee redundancy pay. Say 10,000 people lose their jobs, and assets only add up to half the redundancy cost... That's paid, and tough luck on the rest.
As far as I gather the employee redundancy pay comes first, then if anything is left after that other costs such as company loans or money owed to other companies is paid.
If no assets at all to sell, employee is screwed. Hope they have redundancy insurance.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
A company spending money in the local market is always (ok, maybe not in the US) encouraged to do so, instead of putting money in their pockets. Leasing all those cars created an entire industry of various fleet management companies, with tens of thousands of people employed. Of course the government would encourage such behaviour.
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@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@DustinB3403 I see. And there is no compensation involved? Some countries I worked in, if you are sacked, you get compensation, but if you decide to leave, you get nothing
In the UK it depends. If you are sacked due to gross misconduct you wont get any money. If you are made redundant, you will get a set amount based on length of employment (could be more, but by law its at least that set amount), and if you take voluntary redundancy, you get a package as setup by the former employer... so, it depends.
If you signed a contract for 3 months notice, usually you can negotiate to leave early if you really want. "Im going to give two months". But, if you just walk out you didnt mean your contractual obligations and that could have ramifications.
In the US, one is called being fired and one being laid off. Laid off = made redundant.
Yep, here being laid off will see you get redundancy pay, being fired wont (unless you have a special contract).
In the US, if you are laid off (made redundant) you can apply for unemployment benefits. This is a state level thing, all companies that have employees must pay into the unemployment benefit plan. this pool of money is used to help keep people afloat while they look for new work.
you can even apply to get this if fired or you quit, but it changes how long until you become eligible for those benefits.Here, its all by the company by law, not related to the the government paying anything. Official wording:
"You'll normally be entitled to statutory redundancy pay if you're an employee and you've been working for your current employer for 2 years or more. You'll get: half a week's pay for each full year you were under 22. one week's pay for each full year you were 22 or older, but under 41"
What happens if the company goes under and they aren't around to pay?
oh - well over there - there are probably some protections that magically pull money from somewhere to pay them.
Sort of. If a company goes under and is bankrupt, assets the company owned are sold and the sum is put towards all employee redundancy pay. Say 10,000 people lose their jobs, and assets only add up to half the redundancy cost... That's paid, and tough luck on the rest.
As far as I gather the employee redundancy pay comes first, then if anything is left after that other costs such as company loans or money owed to other companies is paid.
If no assets at all to sell, employee is screwed. Hope they have redundancy insurance.
Interesting - in the US, I think it's the opposite, well, I kinda has to be - because there is no redundancy pay.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.That's not what he means. He means that it is a way to get benefits into the hands of the employees without paying so much taxes on those benefits.
Let's be extreme and assume 100% taxes (no one is this high BUT...)
Salary: $10K / mo + $10K tax = $20K per month from the employer
Salary: $7K/mo + $7K tax + $3K/car/housing benefits = $17K per month from employer
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
Right, the bottom line appears to be a desire to pay people more and try to get around poor tax laws. And most people probably liked getting a car, so saw it as a good benefit.
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@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@DustinB3403 I see. And there is no compensation involved? Some countries I worked in, if you are sacked, you get compensation, but if you decide to leave, you get nothing
In the UK it depends. If you are sacked due to gross misconduct you wont get any money. If you are made redundant, you will get a set amount based on length of employment (could be more, but by law its at least that set amount), and if you take voluntary redundancy, you get a package as setup by the former employer... so, it depends.
If you signed a contract for 3 months notice, usually you can negotiate to leave early if you really want. "Im going to give two months". But, if you just walk out you didnt mean your contractual obligations and that could have ramifications.
In the US, one is called being fired and one being laid off. Laid off = made redundant.
Yep, here being laid off will see you get redundancy pay, being fired wont (unless you have a special contract).
In the US, if you are laid off (made redundant) you can apply for unemployment benefits. This is a state level thing, all companies that have employees must pay into the unemployment benefit plan. this pool of money is used to help keep people afloat while they look for new work.
you can even apply to get this if fired or you quit, but it changes how long until you become eligible for those benefits.Here, its all by the company by law, not related to the the government paying anything. Official wording:
"You'll normally be entitled to statutory redundancy pay if you're an employee and you've been working for your current employer for 2 years or more. You'll get: half a week's pay for each full year you were under 22. one week's pay for each full year you were 22 or older, but under 41"
What happens if the company goes under and they aren't around to pay?
oh - well over there - there are probably some protections that magically pull money from somewhere to pay them.
Sort of. If a company goes under and is bankrupt, assets the company owned are sold and the sum is put towards all employee redundancy pay. Say 10,000 people lose their jobs, and assets only add up to half the redundancy cost... That's paid, and tough luck on the rest.
As far as I gather the employee redundancy pay comes first, then if anything is left after that other costs such as company loans or money owed to other companies is paid.
If no assets at all to sell, employee is screwed. Hope they have redundancy insurance.
It's common for US companies to go under with zero assets, though. So people aren't protected in the UK? That's nuts.
Sounds way less socialist than the US
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@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
A company spending money in the local market is always (ok, maybe not in the US) encouraged to do so, instead of putting money in their pockets. Leasing all those cars created an entire industry of various fleet management companies, with tens of thousands of people employed. Of course the government would encourage such behaviour.
I get that, but only to a point. If the owners of the companies wanted the cash, and felt no obligation to enhance the salary/benefits of it's employees, they would just pay the taxes.
Scott's explanation makes the most sense.
Let's say your company wants to hire someone that normally costs $100K, but doesn't want to pay the taxes associated with that. So instead, they offer $97K, and a $3K car... as Scott pointed out (again assuming a 100% tax) if paying $100K, the company would be paying $200K, but if paying $97+ 3K car = $197K, they just saved $3K in taxes... but the employee doesn't have the choice on where that extra $3 was spent - it was spent on that car. Could be worth it.. just depends.
As you said - as the lease value itself became taxable to the employee, doing this dance no longer makes sense (there is a lot of overhead in dealing with those leases), and it becomes cheaper to once again move back to just paying the employee $100K... so my question to you is - when the car was dropped, did you see a pay increase?
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@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
A company spending money in the local market is always (ok, maybe not in the US) encouraged to do so, instead of putting money in their pockets. Leasing all those cars created an entire industry of various fleet management companies, with tens of thousands of people employed. Of course the government would encourage such behaviour.
Encourage through tax laws, primarily. Sounds like poor market manipulation, though. Highly prone to corruption and not good for the economy overall compared to just lowering taxes.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Jimmy9008 said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@DustinB3403 I see. And there is no compensation involved? Some countries I worked in, if you are sacked, you get compensation, but if you decide to leave, you get nothing
In the UK it depends. If you are sacked due to gross misconduct you wont get any money. If you are made redundant, you will get a set amount based on length of employment (could be more, but by law its at least that set amount), and if you take voluntary redundancy, you get a package as setup by the former employer... so, it depends.
If you signed a contract for 3 months notice, usually you can negotiate to leave early if you really want. "Im going to give two months". But, if you just walk out you didnt mean your contractual obligations and that could have ramifications.
In the US, one is called being fired and one being laid off. Laid off = made redundant.
Yep, here being laid off will see you get redundancy pay, being fired wont (unless you have a special contract).
In the US, if you are laid off (made redundant) you can apply for unemployment benefits. This is a state level thing, all companies that have employees must pay into the unemployment benefit plan. this pool of money is used to help keep people afloat while they look for new work.
you can even apply to get this if fired or you quit, but it changes how long until you become eligible for those benefits.Here, its all by the company by law, not related to the the government paying anything. Official wording:
"You'll normally be entitled to statutory redundancy pay if you're an employee and you've been working for your current employer for 2 years or more. You'll get: half a week's pay for each full year you were under 22. one week's pay for each full year you were 22 or older, but under 41"
What happens if the company goes under and they aren't around to pay?
oh - well over there - there are probably some protections that magically pull money from somewhere to pay them.
Sort of. If a company goes under and is bankrupt, assets the company owned are sold and the sum is put towards all employee redundancy pay. Say 10,000 people lose their jobs, and assets only add up to half the redundancy cost... That's paid, and tough luck on the rest.
As far as I gather the employee redundancy pay comes first, then if anything is left after that other costs such as company loans or money owed to other companies is paid.
If no assets at all to sell, employee is screwed. Hope they have redundancy insurance.
Interesting - in the US, I think it's the opposite, well, I kinda has to be - because there is no redundancy pay.
But everyone is always protected. Thank goodness for socialism and sensible laws
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@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.That's not what he means. He means that it is a way to get benefits into the hands of the employees without paying so much taxes on those benefits.
Let's be extreme and assume 100% taxes (no one is this high BUT...)
Salary: $10K / mo + $10K tax = $20K per month from the employer
Salary: $7K/mo + $7K tax + $3K/car/housing benefits = $17K per month from employer
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
Right, the bottom line appears to be a desire to pay people more and try to get around poor tax laws. And most people probably liked getting a car, so saw it as a good benefit.
As long as those people understood they were getting a car inlieu of cash to the benefit of the company - sure.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
A company spending money in the local market is always (ok, maybe not in the US) encouraged to do so, instead of putting money in their pockets. Leasing all those cars created an entire industry of various fleet management companies, with tens of thousands of people employed. Of course the government would encourage such behaviour.
I get that, but only to a point. If the owners of the companies wanted the cash, and felt no obligation to enhance the salary/benefits of it's employees, they would just pay the taxes.
Scott's explanation makes the most sense.
Let's say your company wants to hire someone that normally costs $100K, but doesn't want to pay the taxes associated with that. So instead, they offer $97K, and a $3K car... as Scott pointed out (again assuming a 100% tax) if paying $100K, the company would be paying $200K, but if paying $97+ 3K car = $197K, they just saved $3K in taxes... but the employee doesn't have the choice on where that extra $3 was spent - it was spent on that car. Could be worth it.. just depends.
As you said - as the lease value itself became taxable to the employee, doing this dance no longer makes sense (there is a lot of overhead in dealing with those leases), and it becomes cheaper to once again move back to just paying the employee $100K... so my question to you is - when the car was dropped, did you see a pay increase?
It's most effective when you control their income tiering. So like if an employee would jump a huge amount in tax rate with a small raise, it's better to give them something that isn't taxable. A new computer, longer vacation, car, or house.
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@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
@Dashrender said in Finally leaving my job, and it's just as annoying as I thought it would be:
@dyasny said in Finally leaving my job, and it's just as annoying as I thought it would be:
@scottalanmiller said in Finally leaving my job, and it's just as annoying as I thought it would be:
It's the "no remote" that makes it crappy. Sure, if we didn't allow people to work remotely, then obviously cars would be obvious. But I've been remote since the 1990s. So it's not a good benefit to be given a car, it's an artefact of not being treated as well. Had they let you work remotely, the car would make no sense to them or to you.
Working with crappy dialup isn't fun, and most companies didn't even have the option for remote access back then. But the main reason was that it was cheaper for the companies to lease cars for the employees and claim tax deductible expenses for that, than to report larger gains and pay more tax (taxes are insanely high in Israel). When these cars became a taxable benefit and taxes rose higher and higher every year, it simply stopped making sense for an employee to take a company car instead of buying his own. But there was more than a decade of nothing but cars with various IT company stickers on the roads in Israel, good times, really.
This is simply not true. The cost of lease will always outweigh the amount of taxes paid unless there is a specific unbalanced tax law that gives more credit to the company than the company would pay in those taxes.
Let's use real numbers
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $2500, the company keeps $500 in their pocket.I can't imagine a situation like this (which is what you are claiming)
Lease costs $3000/yr
Paying taxes on that $3000 of profit instead costs $3300 now costing the company $300 from their pocket.That's not what he means. He means that it is a way to get benefits into the hands of the employees without paying so much taxes on those benefits.
Let's be extreme and assume 100% taxes (no one is this high BUT...)
Salary: $10K / mo + $10K tax = $20K per month from the employer
Salary: $7K/mo + $7K tax + $3K/car/housing benefits = $17K per month from employer
Got it! So, again, I'm back to - the company just wanted to give everyone a car as a benefit... it had nothing to do with the actual job. It didn't actually help the company save money (other than as you mentioned, as an employee benefit), but @dyasny didn't seem to be implying that - or I completely misread what he was saying.
Right, the bottom line appears to be a desire to pay people more and try to get around poor tax laws. And most people probably liked getting a car, so saw it as a good benefit.
As long as those people understood they were getting a car inlieu of cash to the benefit of the company - sure.
People generally understand that getting a car is a benefit to them.
