Business Car
  • 27 Nov 2017
  • Nov

The benefit of having a company car is taxed as a percentage of the vehicle’s list price when new. For 2018-19 this percentage will range from 13% for a car with zero CO2 emissions, to 37% for emissions of 180 g/km or more.

Diesel cars tend to have lower CO2 emissions than petrol-powered vehicles of a similar engine size. However, diesels also emit more harmful particles, so a diesel supplement is added to the percentage of list price to increase the taxable benefit of using a diesel company car.

From 6 April 2018 this diesel supplement will increase from 3% to 4%, so the cleanest diesel will be taxed at 17% of list price and those with CO2 emissions of 160 g/km or more will be taxed at 37% of list price.

This tax increase applies only to cars, not to commercial vehicles. The benefit of using a company van for private journeys, other than ordinary commuting, will be taxed at a flat £3,350 per year for both petrol and diesel engines in 2018-19. Drivers of electric vans were taxed on £646 for 2017-18, but this benefit is more than doubling to £1,340 for 2018-19.

Vehicle excise duty (VED) or ‘road tax’ will also be tweaked to discourage the purchase of diesel cars. The VED for new diesel cars registered on and after 1 April 2018 will be charged as if the car was in one band higher. This will add £20 to the VED for the smallest diesel cars, and up to £400 for the largest diesel cars, but it will only have an impact on the VED for the first year the car is registered.

Reclaim Overseas VAT
Man On Computer Smiling
Previous post
Who Can Claim The Marriage Allowance?
Wedding Rings
Next post

Leave a Reply

Your email address will not be published. Required fields are marked *