Are You Planning To Get Or Change Your Company Car?
Here are my top tax tips ...
POSTED BY JONATHAN VOWLES ON 03/04/2018 @ 8:00AM
Planning to get or change your company car? Think about your CO2 emissions and list price before you think of anything else! The consequences can last for years ...
If you are planning to get or change your company car, consider a hybrid or electric only!
copyright: hfng / 123rf stock photo (licensee)
Looking forward to the changes in company car tax over the next few years leads to my top tips for choosing a company car:
If you must go for a diesel, make sure it is RDE2 compliant as it will save you 4% on your tax charge.
Why not go for petrol? Unless you have a very high mileage or need lots of torque, a petrol engine might give you just as good fuel economy for a slightly lower list price ... and a lower list price means a lower tax charge.
Go Hybrid, maybe? Hybrids generally have lower CO2 emissions than standard vehicles, so do check them out. Some manufacturers, in particular, have great hybrids.
For 2018 and 2019 a Hybrid should give you a really low benefit in kind tax charge. But note that the next point about your car's all-electric range, especially if you are going to keep it for more than 2 years.
Why not go all-electric? You get the lowest benefit in kind charge of any vehicle and for most people, the range isn't an issue. You often get free parking and the running costs are super low! But, be aware of the vehicle's battery-only range in practice as well as on paper.
What is the importance of the electric-only range of the vehicle? If you have, or are thinking of, a hybrid or all-electric company car, it is important you check the range of your company car on battery power alone.
From April 2020 (only 2 years away!) the company car charge for all-electric and hybrid vehicles will depend on how many miles the car can go on battery power alone. The lowest company car charge is at over 130 miles on battery alone. The next best is 70 to 129 miles on battery alone.
If you'd like some bespoke advice on getting or changing your company car, then do call me on 01234 752 566 or click here to ping me an email and let's see how I can help you.
Until next time ...
If you're looking for a new accountant to help grow your business, do visit www.jvca.co.uk and discover how Jonathan Vowles Chartered Accountants can help you!
I've been an accountant in and for business since 1987 and have a wide experience of consultancy, audit, accounts, taxation and wealth planning work from individuals and small businesses to multinational corporations and charities.
My eclectic interests in growing and developing business span a number of areas … and can be summarised as strategic business advice and tax saving advice.
I have worked with the Chamber of Commerce to deliver courses for people about starting up in business and have lectured about tax for a major accountancy practice and for Milton Keynes College.
I relax by reading fiction and by getting away from the office in a campervan.