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)