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Company Car Taxation

The CO₂ emission scale charges which are used to calculate company car benefit charges have been increased for 2008/09. with the threshold for the minimum charge rate for calculating benefit-in-kind, on company cars, reduced from 140g per kilometre to 135g per kilometre. A new lower 10% band for company cars with CO₂ of 120g per kilometre will also be introduced from the 1 April 2008.

	Taxable % of list price	Taxable % of list price
g/km	2006/07 to 2007/08	2008/09
135#	15*	15*
140	15*	16*
145	16*	17*
150	17*	18*
155	18*	19*
160	19*	20*
165	20*	21*
170	21*	22*
175	22*	23*
180	23*	24*
185	24*	25*
190	25*	26*
195	26*	27*
200	27*	28*
205	28*	29*
210	29*	30*
215	30*	31*
220	31*	32*
225	32*	33**
230	33**	34***
235	34***	35
240	35	35

# Vehicles with 120g/km or less will be taxed at a rate of 10% of the list price

Emissions figures for vehicles are rounded down to the nearest 5g/km.
Diesel supplements: * add 3% ** add 2% *** add 1%
Diesel supplement waived if Euro IV emission standard met and the vehicle is registered before 1 January 2006.

Alternative Fuels

Fuel Type	Discount applicable to scale charge 2006/07
Electric	6%
Hybrid petrol/electric (registered on or after 1/1/98)	3%
LPG/CNG (gas only) (registered on or after 1/1/98)	2%
Bi-fuel (type-approved) (registered on or after 1/1/00)	2%

Cars without an approved CO₂ figure

Engine Size	Pre 1/1/98 car	1/1/98 or later car
1,400cc or less	15%	15%*
1,401 - 2,000cc	22%	25%*
Over 2,001cc	32%	35%

* 3% diesel surcharge applies

Company Car Private Fuel

The scale charge figure for private fuel provided for company cars remains at £14,400 for 2006/07. The benefit in kind charge is calculated by applying the percentage determined by the CO2 emission table opposite to £14,400.

Company Van Taxation

Benefit in kind charges where a van is used for private use (other than home to work travel).

Tax Year	Scale Charge £
2005/06	£500*
2006/07	£500*
2007/08	£3,000#

* Reduced to £350 if van is over four years old at end of tax year.
# Further £500 charge if private fuel also provided.

VAT Fuel Scale Charge

Where employers provide free private fuel for an employee’s company car, the employer is required to pay output VAT using the scale charges as set out below.

Rates applicable from 1 May 2006:

	12 months VAT due per car £	3 months VAT due per car £	1 month VAT due per car £
Diesel Engine
2,000cc or less	154.89	38.72	12.81
Over 2,000 cc	197.34	49.30	16.38
Other Engine
1,400cc or less	163.09	40.66	13.55
1,401ccto 2,000cc	206.28	51.53	17.13
Over 2,000cc	303.09	75.66	25.17

The Government has announced that from the 1 May 2007, the fuel scale charge should be based upon CO₂ emissions to further encourage use of environmentally friendly vehicles.

Mileage Rates

No announcement was made in the Budget with regards to mileage rates therefore the continuing rates are as follows:

Approved mileage rates for private cars (pence per mile)

Engine Size	Up to 10,000 miles	Excess over 10,000 miles
All cars	40p	25p

Company car fuel advisory rates (pence per mile)

Engine Size	Petrol	Diesel	LPG
1,400cc or less	10p	9p	7p
1,401cc to 2,000cc	12p	9p	8p
Over 2,000cc	16p	13p	10p

Vehicle Excise Duty

With effect from 23 March 2006:

Vehicles registered pre 1 March 2001:

Engine Size	£
1,549cc or less	110
Over 1,549cc	175

Vehicles registered on or after 1 March 2001:

VED band	CO₂ emission level (g/km)	Petrol £	Diesel £	Alt Fuel £
A	Up to 100	0	0	0
B	101-120	40	50	30
C	121-150	100	110	90
D	151-165	125	135	115
E	166-185	150	160	140
F	186-225	190	195	180
G*	226 and above	210	215	200

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