It has been since April 2002 that the company car tax has been based on a car's list price and CO2 emission figure.
CO2 emission are measured in grams; The 2009 budget report included the following changes to company car tax scheduled to come into effect from 6 April 2011;
- The basic threshold for the 15% band of company car tax will be reduced by 5g/km of CO2, so that this band will apply to cars emitting between 121 and 129g/km
- Company car drivers in cars that produce more than 129g/km will see their tax bill increase by 1% for every 5g per km increase in CO2 emissions, to a maximum of 35%
- Discounts currently available for Euro IV standard diesel cars registered before 1 January 2006, petrol-electric hybrid cars, road fuel gaas powered cars and E85 biofuel-capable cars will be removed from 6 April 2011
- Hybrid cars emitting 120g/km or less will continue to fall within the 10% band and electric cars will continue to be subject to the 9% band, the lowest for any type of company car
The tax bands have tightened, aligning themselves with lower CO2 emissions as time has passed.
Significant savings for fleets can be made by opting for a fleet vehicle with low CO2 emissions.
CO2 emissions Calculator
The Fleet News co2 emissions calculator enables companies to search on a variety of different makes and models of vehicles to compare co2 emissions and tax bands that they fall within. Have a look at the co2 emissions calculator today.