Announcements to the Company Car Tax Changes have been released this March 2017. Electric Cars and Diesel emissions have been addressed as cited in the previous Autumn Statement.
Company Car Tax; the Budget Update Facts…
In tax year 2017/18 the minimum company car benefit-in-kind tax charge will be 9% (0-50g/km) rising to 37% (190g/km+). In 2018/19 and 2019/20, company car benefit-in-kind tax follows the same well-established format. However, Budget 2017 confirmed the Autumn Statement 2016 announcement that the government would reshape company car benefit-in-kind taxation from April 2020 to provide a stronger incentive for fleets to operate ultra-low emission cars (currently defined as being up to a maximum of 75g/km) and employees to choose them as company cars.
As a result, a mileage range element is to be introduced in 2020/21 applicable to zero emission cars and ultra-low emission cars (up to 50g/km) equipped with an electric battery and therefore able to be driven in zero emission mode. As the table below highlights, company car benefit-in-kind tax rates increase as a model’s electric mileage range capability reduces.
For internal combustion engine powered cars and plug-in vehicles with emissions above 50g/km, company car benefit-in-kind tax rates in 2020/21 start at 15% (51-54g/km), rising to 37% (160g/km+).
The above table shows Company car tax 2017/18 to 2020/21
For each tax year add 3% for diesel cars up to a maximum of 37% until April 2021. (Source Alphabet)