In an article on taxation, Outlook Money — June 16, 2010, suggests:
Buy your car in your spouse’s name. Then lease it to your company, which in turn can let you use it as an employer-provided vehicle. [Due to certain deductions, you reduce the amount of income tax that you need to pay.]
I’ve also seen variations of this theme that suggest buying your car in your father’s or mother’s or relative’s name. I honestly believe that it isn’t worth structuring your vehicle ownership this way just so that you can avoid paying a certain amount as income tax. That said, in general, you should never monetarily tie yourself to your employer — be it the mechanism: employer loans, car leases, and such.
Keep the car in your name. Pay income tax. Sleep without worry. That’s what I would advise.
What do you think?
Further reading:
- Real-life Lessons: The Value of an Emergency Fund
- Organizing Your Finances: Do You Have All Your Income Tax Returns Safely Filed and Available?
- Tip Tuesdays: Understand the Cash Outflow of a Financial Instrument Before You Invest In It
- Tip Tuesdays: When’s a Good Time to Pre-close a Personal Loan?
- Tip Tuesdays: Why You Shouldn’t Opt for a Decrease in Your Employee Provident Fund Contributions in Lieu of an Increase in Your Take Home Pay
