How your company car can save tax, cash and the planet!

Is your company planning on purchasing a new vehicle? Is it time to go green?

Under current tax rules, low emission cars qualify for 100% tax relief in the year of purchase against profits provided certain criteria is met:

• CO₂ emissions must be < 75g/km (50g/km from April 2018).
• The vehicle must be purchased new.

The Government currently have a “Plug-in car, motorcycle and van” grant available which can help with a contribution. This scheme is currently planned to end in March 2018.

The grant covers:

• 35% of the cost of a car, up to a maximum of either £2,500 or £4,500 depending on the model.
• 20% of the cost of a van, up to a maximum of £8,000.
• 20% of the cost of a motorcycle, up to a maximum of £1,500.

Details of vehicles the grant covers can be found on the following HMRC website: Grant eligibility

Fully electric cars aren’t yet perfect especially when it comes to their range, normally under 100 miles with a full charge. A hybrid could be a good alternative to extend the range, but this could result in a lower grant contribution and of course running costs slightly more than fully electric vehicles.

Other potential benefits of lower emission cars include:

• Low running costs
• Low/zero road tax
• Can be exempt from city centre congestion charges

If you would like to discuss this with a member of our team then please contact us.