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The UK Chancellor recently announced the Autumn Budget and Spending Review.
In line with the Government’s Ten Point Plan for a Green Industrial Revolution, and to support the UK’s plan to ban the sale of new petrol and diesel car sales (except for some hybrids) in 2030, the Budget further incentivises company car drivers to select vehicles with zero emissions of CO2.
In summary, new benefit–in–kind (BIK) tax rates will take effect from April 2022 but these will remain frozen until 2024/25. BIK tax rates for 100% electric cars with CO2 emissions of 0g/km will rise from 1% to 2% of taxable value on the same date.
A continued freeze on fuel duty into 2023 (the 12th consecutive year without a rise) and the announcement of small but significant changes to Vehicle Excise Duty from April 2022 were also confirmed.
We have created a detailed summary containing:
– BIK tax rate implications for company car drivers
– Information for employers on Class 1A National Insurance Contributions
– Information on grants and other support for home and workplace charging equipment
– Answers to electric vehicle frequently asked questions
Download our detailed summary to find out what the latest announcements mean for you:
Paul McGuire, Managing Director at Traction Finance commented: “We welcome the Chancellor’s decision to freeze BIK at 2% until at least March 2025. This demonstrates the Government’s commitment to sustainability and gives companies and company car owners choosing to convert to zero emission cars the comfort of some certainty in these turbulent economic times.”
If you have any further questions about what the budget announcements mean for you or your company, please contact the Traction team.