Low emission company cars.

hillbilly5

Can anyone explain to me the benefits to the company for using company cars that are either low emission or hybrid vehicles (such as Toyota Prius)?

My company car is due for renewal soon and I want what will cost as little tax as possible out of my pocket (Toyota Prius looks good for a family sized car). However, I want to know how I can 'sell' the tax benefits to the company for doing so - I understood that somehow there is more they can write off against tax with these low emission cars.

Can anyone explain or help me??

Thanks!

Scottie44

Hillbilly5

Found this site; thought it might be of interest to you:

http://www.cartax.co.uk/Articles/Article_Effect_Sub_120GKM_CO2.asp

There is lots of other info on the web about this - I am self employed so I need to try and keep up with this sort of thing but I am not too good at it; things change too often!

Bean_Counter

hillbilly5 wrote: »

However, I want to know how I can 'sell' the tax benefits to the company for doing so

The taxable benefit of the company car (ignoring fuel) is derived from the CO2 emissions and the list price of the car. The lower the CO2 emissions, the lower taxable charge.

The company also pay Class 1B national insurance of the benefit at 12.8%. So the lower the CO2 emissions, the lower the tax bill for the company.

Also I think that RFL is cheaper. With the Prius, I dare say that petrol consumption is better, insurance might be cheaper etc. Also it might portray a more environmentally responsible company image.

greyteam1959

Scottie44 wrote: »

Hillbilly5

Found this site; thought it might be of interest to you:

http://www.cartax.co.uk/Articles/Article_Effect_Sub_120GKM_CO2.asp

There is lots of other info on the web about this - I am self employed so I need to try and keep up with this sort of thing but I am not too good at it; things change too often!

Scottie......employ a good accountant and then they will do all this sort of thing for you !!!!!!!!!!

m277

From the company's point of view:
Companies are allowed to claim a First Year Allowance for the car and since it's on a low emission car it's a 100% capital allowance on the car. Which in turn reduces their tax adjusted profits and so they pay less tax. If it wasn't a low emission car then they can only claim a maximum of £3000 on capital allowances for the car.