Fleet News

Inland Revenue to redesign car tax form

OFFICIALS at the Inland Revenue have promised a redesign of a key form used by fleet managers following complaints that it could lead to major errors in company car tax calculations. The P46(car) form is a vital indicator of the company car tax that an employee will need to pay from having a company vehicle available for private use.

The form has been redesigned to cope with the changing taxation system in 2002, when company car tax will be based on list price and carbon dioxide emissions instead of list price and mileage. But although it demands figures for the CO2 emissions of the vehicle, there are glaring errors in the form, with no question asking whether any diesel engines have reached Euro IV emissions compliance, allowing for the controversial 3% supplement imposed on diesels to be removed.

Following a Fleet NewsNet article showing that disabled company car drivers who were forced to use automatic cars would be penalised because of their higher CO2 emissions, the Government announced it would base the tax on an equivalent manual car instead. This week, Mary Braim, Inland Revenue policy adviser on transport benefits, said that action was being taken with production of a second version of the form, aimed at dealing with any potential problems faced by fleet managers.

She said: 'We are aware of the problem, but the form was produced before the latest developments with CO2-based company car tax, for example the decision to remove the 3% diesel supplement for Euro IV compliant engines. As there are no Euro IV diesel engines at present, it is not a crushing problem. If fleet managers are filling in the current form and they find they are having difficulty, they should attach the additional information necessary.'

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