Car Tax

By: Christopher Wareing

Company cars are one of the most common benefits employees and directors can take advantage of. However the tax position of providing and using company cars is complex and changes regularly with each Budget.

For example, in both 2017-18 and 2018-19, the appropriate percentage of the list price of company cars subject to tax will increase by 2 percentage points for cars emitting more than 75 gms of carbon dioxide per kilometre (g CO2/km).

Generally different tax rules apply where it is the employee who owns (or rents) the car but who is then reimbursed particular expenses by his or her employer.

Other rules apply when the vehicle is not a car as specially defined for tax purposes (eg vans). So for the business owner or accountant advising a business this therefore raises the first fundamental question – what is a car?

Tax Advisers comprises a team of tax experts who understand the issues and challenges facing businesses and accountants who need to ensure that the provision of company cars is a benefit to the business as well as to employees, and that the complications and hazards associated with them do not impact the bottom line.