Vehicle Benefits (Company Cars)
Chargeable on employees earning £8,500 or over (including benefits), and directors.
The tax you pay on your company car is governed by four factors:
(for most types of car, this is all the information you need to work out the taxable benefit)
You can find your taxable percentage from 1st May 2008 using the following table:
Find out what your car CO2 emissions are: Click Here
Reliable emissions data is not widely available for cars registered before 1 January 1998. For them, the following taxable percentages apply, regardless of fuel type:
Car fuel benefits
If the employee pays for the full cost of all fuel for private journeys (usually including home to work) there will be no car fuel benefit. In all other cases the full tax charge will be due. The taxable car fuel benefit, for 2008/09, is calculated by multiplying £16,900 by the same percentage as applies (or would apply) for the car benefit. Example: A company car driver has a car which, on the day before it was first registered, had a list price of £18,000. It runs on petrol, and emits 177 g/km of CO2. If we assume the driver pays tax at 40%, the annual tax bill on the car is: £18,000 x 23% x 40% = £1,656. If the employer provides any fuel used for private journeys and is not re-imbursed for the cost, the 2008/09 tax bill for the fuel is: £16,900 x 23% x 40% = £1,554.80.
The taxable benefit for the unrestricted use of company vans is £3,000 (with no reduction for older vans) plus a further £500 of taxable benefit if fuel is provided by the employer for private travel.
Van drivers can avoid a benefit charge if they agree not to use the van for personal journeys. Driving to and from work is acceptable so long as there is a reasonable amount of business use.
D G East Partnership
Corbins Angley Rd, Cranbrook, Kent TN17 2PL