Company Car Scheme
I have attached sample company car scheme policy.
<name of the company>
/POLICY/CAR SCHEME/06 Date: 01-01-06
Subject: Car Scheme
The objective of the scheme is to ensure smooth easy and comfortable mobility of the senior executives of the company for their official work in a dignified manner.
All Units and Offices of <name of the company>.
This scheme is applicable to all Executives in the cadre of Assistant General Manager & above at the sole discretion of the management. The car to be provided by the company could be company’s own car or it could be a rented car. In case rented car has to be provided, the eligible executive staff or one of his family members shall have to purchase the car in their name and rent it to the company as per the following criteria:-
|CATEGORY||MAX. COST OF CAR (RS./LAC.)|
The facility of driver shall be provided to the GMs / DGMs only. In case company is not able to provide drivers to those GMs / DGMs who are availing the benefit of car (either on being provided by the Company or on EMI basis) EMI shall be increased by Rs. 4000.00/3500.00 respectively subject to engaging driver. However if a GM / DGM is provided company car without driver, he will be reimbursed the cost of driver by accounts department directly.
This benefit shall not be available to AGMs.
METHOD OF CALCULATING MONTHLY HIRE CHARGES:
The monthly hire charges shall consist of two parts: –
- EMI of Car –The calculation of finance amount for the purpose of EMI – this will be equivalent to finance amount from bank plus down payment plus road tax, registration charges and cost of accessories subject to the limit mentioned above. On this amount EMI will be calculated on basis of prevalent interest rate as on 1st April. This will be determined by DGM (Finance)- Delhi Office.
- Driver charge wherever applicable.
The running expenses of the vehicle shall be claimed on monthly basis. It includes expenses incurred on fuel, repairs & maintenance, toll tax and parking charges etc. The replacement of tyres / battery shall be allowed only after every 45,000 kms/ 3years.
Personal use of car shall be limited as under:
- General Managers: Six thousand Kms per annum.
- Deputy General Managers: Four thousand eight hundred Kms per annum.
- Assistant General Managers: Four thousand Kms per annum.
In the 1st year and the last year of the hire of the vehicle, the kms. of the personal use shall be calculated on pro-rata basis. The reimbursement of toll tax and parking charges etc. shall not be allowed in case of personal use of the vehicle.
- The maximum cost for reimbursement of accessories shall not exceed Rs.30000/-, 25000/- & 20000/- for GMs/ DGMs /AGMs respectively.
- The purchase of car shall be allowed in his or his family member’s name provided the family member is a major. The family includes spouse and children.
- In addition to the above, actual expenses on Insurance cover shall also be reimbursed @ 100% in case of GM/DGMs and 50% in case of AGMs on annual basis.
- If the eligible executive staff wants to buy car costing more than his entitlement, he / she shall have to bear additional cost himself. In case of new joinee / new cadre / existing executive covered in this scheme already has a car in his or his wife name subject to the car is less than five years old and he wants to continue with the same car, he shall also be reimbursed EMI till the car is becomes five years old. The company will not hire any car, which is more than five years old.
- A logbook will have to be maintained in the car for claiming running expenses.
- Any tax arising or which may arise in future on account of hiring the car shall have to born by the owner.
- The GMs/DGMs and AGMs who are provided the car on EMI basis shall have the option to sell the car himself any time whenever they want and buy another new car and again the EMI should start at the rate prevalent at that time.
- In case an executive is already availing car facility and having a car of a value more than his total entitlement and then his entitlement gets revised in future or he gets promoted, his rental charges shall be recalculated from the date the employee become entitled for higher amount.
PROCEDURE FOR AVAILING THIS FACILITY
- The entitled employee will submit his application to the Unit / Corporate HR as the case may be who will verify his entitlement and forward the same to Unit Head / Executive Director as the case may be. On approval, original copy will go to the Accounts Deptt. and Xerox shall be placed in the personal file of the individual.
- After obtaining sanction, the person will purchase the car; will produce all the required documents to the accounts department. Accounts department on the basis of documents and eligibility shall calculate monthly rental charges and sign car hiring agreement with the individual. Copy of the agreement shall be given to concerned individual and another copy shall be marked to the personal file.
- The rental and other charges shall be payable from the date of approval or the purchase of the vehicle which ever is later. The payment will cease automatically in case of separation of employee from the company form the date of separation.
- The running & repair charges shall be payable once in a month on production of required bills and Xerox of the logbook. Further, advance for repair shall be allowed on request of individual.
Effective Date: 01.11.2005
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