Car Lease Option in IT Companies

Most of the companies give car lease option to manager level and above. Earlier TCS used to give car with chauffer to Director level and above. In Accenture this scheme is available to all the employees of Level D (Services Workforce), Specialist (Enterprise Workforce), Consultant  (Consulting Workforce) and Team Lead (Solutions Workforce) and above in India who would like to opt for a company leased car for their business and personal use. This option is not available in Cognizant.

These are the general process to be followed in any company. Check with your finance department for the exact terms and conditions

Employee should submit the compensation plan on the website declaring the value of the car.

• The employee should identify the car to be acquired, negotiate the price and obtain a Proforma Invoice from the dealer and send it to Finance . For example:
  –    Controllership in Accenture, Bang3 Office in Banerghatta Road, Bengaluru,
  –    MEPZ office in CTS,Chennai.The Proforma Invoice should be in the name of the company specifying the cost of the car, colour, and particulars of payment.
• The employee should also fill in the enclosed application form and Undertaking and forward the same to Controllership.

The following points should be noted while taking car lease option in companies:

• Lease finance will be available only for the cost of the car, RTO registration charges and taxes.
• Insurance will be covered through company recommended insurance company and premium will directly paid by the company and the same will be adjusted against the employee’s compensation.
• RTO agent’s charges are not covered under lease finance.
• The car must be registered at the place where the Company has an office in India
• Employee can avail the car only at his office location.
• The employee would take the delivery of the car and obtain the Sale Invoice from the dealer. Copy of the Sale Invoice needs to be forwarded to the Finance Department of your company.
• Employee should submit the copy of the driving license to Finance  and obtain the Insurance policy after 3 weeks from the date of purchase.

Sample:

Vendor : SLV

*Applicable taxes/levies/duties are extra and will form part of the lease rental and the same will be recovered from the employee’s compensation.

Note : Car lease rental are calculated on the Amount financed less VAT as per the invoice submitted by the dealer.  VAT will be charged on the lease rentals separately

Example :

Cost of the car –        100,000
VAT                –           12,500

Lease Rentals are calculated on Rs. 100,000
3 Years  – 30,127 + VAT @12.5 and any other taxes as applicable.

Read: Cab Transport and Car Lease Policy

Note that VAT has changed in the financial year 2015-2016

Click here to download a sample car lease Form

General  Guidelines :

• The lease period, once chosen, cannot be changed.
• On completion of the lease period or on cessation of employment, whichever is earlier, the employee will forthwith arrange for the car to be purchased from the Leasing Company.
• Employees opting for this scheme should allocate necessary funds from their compensation to enable further processing for the purchase of the car.
• All the employees should submit the declaration along with the car lease application form.
• All the necessary papers should be submitted to the finance within 5 working days upon receipt of the payment of the car.
• All the necessary taxes etc. should be borne by the employee in case of any transfer of employment.

Note: Do not take lease if you plan to leave the company before the lease end date (i.e 3 years), otherwise your cost will increase.