‘Should I buy a car through my company?’
It’s a question we’re often asked and often it’s just not
clear cut.
The Benefit In Kind you pay personally is often outweighed
by the potential for a company to arrange finance more cheaply.
Claiming 45 pence per mile personally can often be more
beneficial than having the company pay for individual motoring expenses.
Having said all that, some changes are afoot, especially if
you want to join the electric revolution. The changes reflect the government’s desire to drive down
CO2 emissions and to encourage fleet managers to clean up their act.
So, from 6th April 2020 for the 2020/21 tax year
the Benefit In Kind on most electric vehicles drops from 16% to 0%. It then increases to a minuscule 1% and 2%
over the next two years.
After that it’s a bit less certain but clearly this is a
huge incentive to at the very least consider the electric option.
But what about the other side of the environmental coin… the
fossil fuel guzzling gas monsters. Or,
in other words, petrol and diesel cars.
Well, from 1st April 2020 all new registrations
will have their new official emissions figures.
A lot of cars are going to show an increase which in turn could well affect
the Road Fund License and Benefit In Kind calculations.
I think you can probably see what the government is trying
to get at here… so, if you’re wedded to the idea of petrol or diesel it might
well be worth taking a pre-registered or stock vehicle.
If you’re a titan of the new environmental age then you
might want to consider an electric vehicle after 6th April…
As always, if you’d like to talk through your options do
drop us a line or give us a call and we’ll happily talk through your business
options.
You can get us on: 0131 202 9888
or email us on: westedinburgh@taxassist.co.uk
