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Changes to the car benefit rules from 6 April 2008

Just to remind you, for company cars the benefit is calculated by multiplying the list price (not the cost price) by the ‘appropriate percentage’.

The appropriate percentage is based on the car’s CO2 emissions figure, with some adjustments to take account of different fuels.

The calculation of the appropriate percentage changes in three ways with effect from 6 April 2008:

  •  the lower threshold, the CO2 emissions figure which determines the appropriate percentage for all cars, is reduced from 140 to 135.
  • A new ’10 percent band’ is introduced for cars with CO2 emissions figure of exactly 120 g/km or lower.
  • There is a new 2 percent reduction for cars manufactured to be able to run on E85 fuel, a mixture of 85 percent bio-ethanol and 15 percent unleaded petrol.

 

 

Date: 4th February, 2008
Author: Cathy Corns

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