London: +44 (0)20 7236 2601
St Albans: +44 (0)1727 869141
Rickmansworth: +44 (0) 1923 771010
Milton Keynes: +44 (0)1908 605552

Company Car Tax – deciding to change your company car?

The government has now confirmed the tax rates for company cars up to 5 April 2021.  The changes highlight the discrepancy between the tax on a car with low to medium CO2  emissions compared to a car with high CO2  emissions.  There has been no change to the maximum amount chargeable for the high emission cars, it is still at 37%.  The impact of this can be seen in the following example:-

If you were driving a Ford Mondeo with a list price of £22,000 in 2014 the annual taxable amount would have been £3,300. If you keep this car in 2020 the annual taxable amount will increase to £5,940 (an increase of £2,640). On the other hand if you had a Range Rover with a list price of £55,000 in April 2014, your taxable amount would have been £19,250. In 2020 the annual tax amount for this car will be £20,350. A small increase of £1,100.

It is not only the employee that gets hit with the extra cost, employers have to pay class 1A NIC on the company car (and fuel benefit if provided). 

 

 

Date: 20th April, 2017
Author: Cathy Corns

SHARE THIS

Articles from this Author

Contact Business Service Partners

Choose from the drop down menu below to select a Partner to contact.

Tweet

We enjoyed tea and cake with Flo and presented a cheque to @willenhospice for proceeds of #timefortea pic.twitter.com/uDUvt3cOJw

Our latest edition of UK Inward Investment - what are the opportunities for you, is out now bit.ly/2xB0cun click to read more

Follow

LinkedIn

For the latest Mercer & Hole news, visit our LinkedIn page mercer-&-hole

Click here to follow us on LinkedIn