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Company cars
Car benefit
The threshold CO2 emissions rate is frozen at 140 g/km until 5 April 2008. The threshold for 2008/09 will be 135 g/km. The rate of the taxable benefit ranges from 15% to 35% of list price (plus certain accessories) for most petrol or diesel-powered cars.
You can find your taxable percentage of the list price for 2007/08 using the following table:
Company car tax rates
| Gas Guzzlers |
|---|
| But the chancellor was accused by critics of doing too little to confront global warming, despite backing a review by the economist Sir Nicholas Stern that called for urgent action on the environment |
Diesel cars are generally subject to a 3% surcharge - with some exceptions, the taxable benefit for a diesel car is 3% higher than for a petrol car with identical CO2 emissions. The 3% surcharge was waived for cars which complied with Euro IV emissions standards, and this applies to 5 April 2006. Thereafter, the waiver applies only to Euro IV compliant cars first registered no later than 31 December 2005.
The discounts for lower emissions vehicles are:
- 2% for bi-fuel lpg and petrol cars manufactured or converted before type approval
- 3% for hybrid electric and petrol cars
- 6% for electric-only cars.
With effect from 2008/09, there will be a reduced taxable percentage rate of 10% for those cars with CO2 emissions of 120 g/km or less.
Back to topCar fuel benefit
The multiplier for car fuel benefit has not changed since the current scheme was introduced. It stands at £14,400.
Car and fuel benefit calculation
The amount chargeable to income tax (user) and Class 1A national insurance contributions (employer) for 2007/08 is calculated by multiplying list price (car benefit) or the fuel multiplier (fuel benefit) by a percentage based on the rate at which the car emits carbon dioxide (CO2 in g/km) (see table above).
Take a car with a list price of £18,000 when it was first registered (say 31 March 2007) and which emits carbon dioxide at a rate of 180 g/km.
| Car benefit | Petrol | Diesel |
| List price | £18,000 | £18,000 |
| Taxable percentage | 23% | 26% |
| Taxable benefit | £4,140 | £4,680 |
| Tax (22% taxpayer) | £911 | £1,030 |
| Tax (40% taxpayer) | £1,656 | £1,872 |
| Employer’s Class 1A NIC | £530 | £599 |
| Fuel benefit | Petrol | Diesel |
| Multiplier | £14,400 | £14,400 |
| Taxable percentage | 23% | 26% |
| Taxable benefit | £3,312 | £3,744 |
| Tax (22% taxpayer) | £729 | £824 |
| Tax (40% taxpayer) | £1,325 | £1,498 |
| Employer’s Class 1A NIC | £424 | £479 |
VAT fuel scale charges
Fuel scale charges commencing 1 May 2010 to 30 April 2012
Fuel scale charges for VAT
- VAT fuel scale charges for 1 month period
- VAT fuel scale charges for 3 month periods
- VAT fuel scale charges for 12 month periods
VAT fuel scale charges for 1 month periods
| CO2 band g/km | From 1 May 2010 | From 1 May 2011 |
|---|---|---|
| 120 or less | 47.00 | 52.00 |
| 125 | 70.00 | 78.00 |
| 130 | 70.00 | 84.00 |
| 135 | 75.00 | 89.00 |
| 140 | 80.00 | 94.00 |
| 145 | 85.00 | 99.00 |
| 150 | 89.00 | 105.00 |
| 155 | 94.00 | 110.00 |
| 160 | 99.00 | 115.00 |
| 165 | 104.00 | 120.00 |
| 170 | 108.00 | 126.00 |
| 175 | 113.00 | 131.00 |
| 180 | 118.00 | 136.00 |
| 185 | 122.00 | 141.00 |
| 190 | 127.00 | 147.00 |
| 195 | 132.00 | 152.00 |
| 200 | 137.00 | 157.00 |
| 205 | 141.00 | 162.00 |
| 210 | 146.00 | 168.00 |
| 215 | 151.00 | 173.00 |
| 220 | 156.00 | 178.00 |
| 225 or more | 160.00 | 183.00 |
| 230 | ||
| 230 or more | 165.00 |
VAT fuel scale charges for 3 month periods
| CO2 band g/km | From 1 May 2010 | From 1 May 2011 |
|---|---|---|
| 120 or less | 141.00 | 157.00 |
| 125 | 212.00 | 236.00 |
| 130 | 212.00 | 252.00 |
| 135 | 227.00 | 268.00 |
| 140 | 241.00 | 283.00 |
| 145 | 255.00 | 299.00 |
| 150 | 269.00 | 315.00 |
| 155 | 283.00 | 331.00 |
| 160 | 297.00 | 346.00 |
| 165 | 312.00 | 362.00 |
| 170 | 326.00 | 378.00 |
| 175 | 340.00 | 394.00 |
| 180 | 354.00 | 409.00 |
| 185 | 368.00 | 425.00 |
| 190 | 383.00 | 441.00 |
| 195 | 397.00 | 457.00 |
| 200 | 411.00 | 472.00 |
| 205 | 425.00 | 488.00 |
| 210 | 439.00 | 504.00 |
| 215 | 454.00 | 520.00 |
| 220 | 468.00 | 536.00 |
| 225 or more | 482.00 | 551.00 |
| 230 | ||
| 230 or more | 496.00 |
VAT fuel scale charges for 12 month period
| CO2 band g/km | From 1 May 2010 | From 1 May 2011 |
|---|---|---|
| 120 or less | 570.00 | 630.00 |
| 125 | 850.00 | 945.00 |
| 130 | 850.00 | 1,010.00 |
| 135 | 910.00 | 1,070.00 |
| 140 | 965.00 | 1,135.00 |
| 145 | 1,020.00 | 1,200.00 |
| 150 | 1,080.00 | 1,260.00 |
| 155 | 1,135.00 | 1,325.00 |
| 160 | 1,190.00 | 1,385.00 |
| 165 | 1,250.00 | 1,450.00 |
| 170 | 1,305.00 | 1,515.00 |
| 175 | 1,360.00 | 1,575.00 |
| 180 | 1,420.00 | 1,640.00 |
| 185 | 1,475.00 | 1,705.00 |
| 190 | 1,530.00 | 1,765.00 |
| 195 | 1,590.00 | 1,830.00 |
| 200 | 1,645.00 | 1,890.00 |
| 205 | 1,705.00 | 1,955.00 |
| 210 | 1,760.00 | 2,020.00 |
| 215 | 1,815.00 | 2,080.00 |
| 220 | 1,875.00 | 2,145.00 |
| 225 or more | 1,930.00 | 2,205.00 |
| 230 | ||
| 230 or more | 1,985.00 |
VED rates
| Band | CO2 emissions g/km | Petrol | Diesel | Alternative fuel |
| A | 100 and below | £0 | £0 | £0 |
| B | 101 - 120 | £35 | £35 | £15 |
| C | 121 - 150 | £115 | £115 | £95 |
| D | 151 - 165 | £140 | £140 | £120 |
| E | 166 - 185 | £165 | £165 | £145 |
| F | 186 - 225 | £205 | £205 | £190 |
| G* | 226 and above | £300 | £300 | £285 |
| * New cars registered from 23 March 2006 | ||||
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