Tax

As from 6th April 2002 the benefit in kind charges were changed and are based on cars cash price (P11d) and the level of carbon dioxide emissions (Co2). The Vehicle Certification Agency provides a guide to the CO2 emission figures of all new cars. This can be found on the internet at http://www.vcacarfueldata.org.uk/

The table below shows, in percentage terms, the percentage of the car's P11d figure which is to be applied as a taxable Benefit in Kind. 

2006/7 (gm/km)	2007/8 (gm/km)	2008/9 (gm/km)	2009/10 (gm/km)	% of list price(P11d)
140	140	135	135	15%*
145	145	140	140	16%*
150	150	145	145	17%*
155	155	150	150	18%*
160	160	155	155	19%*
165	165	160	160	20%*
170	170	165	165	21%*
175	175	170	170	22%*
180	180	175	175	23%*
185	185	180	180	24%*
190	190	185	185	25%*
195	195	190	190	26%*
200	200	195	195	27%*
205	205	200	200	28%*
210	210	205	205	29%*
215	215	210	210	30%*
220	220	215	215	31%*
225	225	220	220	32%*
230	230	225	225	33%**
235	235	230	230	34%***
240	240	235	235	35%****
* Add 3% for Diesel	** Add 2% for Diesel	*** Add 1% for Diesel	**** Max charge no supplement for Diesel

 

All diesel vehicles registered after 1st January 2006 attract a supplement of 3% applied to the percentage of list price, thereby increasing the minimum threshold to 18% but subject to a maximum taxable benefit for any car of 35%.

For diesel cars meeting Euro4 emission standards and registered prior to 31st December 2005, the supplement is waived for the life of the car.

For environmentally friendly (green) cars, reductions in the above percentage rates are as follows:
 
Discounts as at 2007 are:

• Cost of conversion is disregarded for bi-fuel gas/petrol cars converted after type approval, no additional percentage discount.
• 2% discount for bi-fuel gas/petrol cars manufactured or converted before type approval
• 3% discount for hybrid petrol/electric cars
• 6% discount for electric-only cars

Vans

From April 2007 the BIK scale charge for unrestricted private use is £3000 irrespective of the age of the vehicle. A separate charge of £500 on private fuel provided free by the employer (previously included in the scale charge) is also applicable from April 2007 and the discount for older vans has been removed.

Since April 2005, for unrestricted private use of company vans under 3500kgs and pick-ups in excess of 1 tonne payload, the benefit charge has been £500 irrespective of the vehicle’s value and included any free fuel provided for private use. For vans and pick-ups over 4 years old at the end of the tax year the charge was reduced to £350.

If the employer specifically prohibited any private use, other than home to work travel, there was no charge at all.

Fuel

Since April 2003, where fuel is provided for private use with a company car, the benefit charge is related to the car’s Co2 emissions. This is based on a percentage of nominal value of £14,400 determined by the Co2 emissions of the car.

For example, in 2007/2008 tax year, for a car that emits 185g/km of Co2 the Bik charge would be 24% of the nominal benefit value of £14,400, e.g. £14,400 x 24% = £3456. Employees will then pay income tax at their marginal rate of either 22% or 40% on the benefit.
Therefore a 40% tax payer will actually pay £3456 x 40% = £1382.40.