What are the tax benefits of Low Emmission and Electric Cars? Reply


If you have a company car the chances are Benefit in Kind tax will be a concern for you, HMRC have a calculator to work this out

http://cccfcalculator.hmrc.gov.uk/CCF0.aspx

But both you and your company could be better off with a Low Emmission or Electric Car.

Capital allowances

If you buy a new car for your business that has CO2 emissions of 110 grams or less per kilometre (g/km) driven, or is electric, you can qualify for a 100 per cent first-year capital allowance. This allows you to offset the whole cost of the investment against taxable profits in the year you make the purchase until 31 March 2013.

Vehicle taxes

New cars have fuel economy labels which show how fuel efficient they are. The label shows how much CO2 the car emits and also how much vehicle tax you will have to pay each year. Lower CO2 emissions mean lower vehicle tax and lower running costs.

http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1080532548&type=RESOURCES

Benefit in Kind

Currently zero emmission electric cars have zero benefit in kind but this is set to change in 2015 when the rate will be 13%.

A 5% Benefit in Kind band is now in place for cars that emit below 75g/km CO2, but this will also change in 2015.

steve@bicknells.net

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