The company car - a holiday companion?

Summer has arrived and this means holidays are just around the corner. But how to cover the distance between home and the holiday destination efficiently? Many people are entitled to a company car, which they may use for business mobility and private trips. In 2009, former German health minister Ulla Schmidt took her official car on holiday to Spain.[1] Criticism arose when Mrs. Schmidt’s car went missing and she had to explain how she was spending the taxpayer’s money. Is taking the company car on holiday even allowed? It would certainly be convenient seeing that you know the car better than one you rent at the holiday destination. Furthermore, your spouse and children (over 21 years of age[2]) are by contract often allowed to drive it too. Although rules and regulations differ from country to country, it is essential to be informed. Otherwise, you risk paying more and that's what you really don't want after your holidays!

Who pays for what?

You cannot simply assume that you may take your company car on holidays because you’re allowed to use it for private journeys. Some may only use the company car for business mobility and private trips in a specific country, namely the one where the company is located. If, knowing this, you take the car abroad, you run the risk of being sacked on the spot. It all depends on the contractual agreements the employer makes with his or her employee. And if these are favourable, taking the company car on holidays can be a real money-saver. You need to pay special attention to who covers the fuel and toll costs, car care, car repair, and insurance.[3] All of these expenses can be shared by employer and employee. In most cases your employer must also file an authorisation stating who can and cannot drive the car during the vacation. This is because if complications occur, such as an accident or theft, you must be able to show that you’re allowed to use the car.[4] You might also be asked for the car’s official documents when you pass a border and thus having everything in print could really pay off.

Clarify your rights in advance

In a nutshell, there is a good chance that you may use your company car to go on holidays. If so, communication is the key to agree on what you can and cannot do. Driving always costs money and the one thing you really want to avoid is bickering about expenses with your employer after you’ve returned from your relaxing vacation.

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