Fleet News

Buy now to beat the taxman, says Volvo

Businesses could miss out on premium models because they fail to exploit tax incentives currently available on high-end, low emission vehicles, says Volvo Business Car Sales.

At the moment, using first year allowances, companies may offset 100% of the cost of buying a new car against their corporation tax liability if its CO2 emissions are 95g/km or less.

Sole traders and partnerships can benefit by writing down as much as 100% of the cost of qualifying cars against their income tax liability.

However, the 100% tax relief available in the year of purchase will reduce to 18% after March 31, 2015, across the Volvo V40 D2 range, says Volvo Car Business Sales.

From that point, tax changes mean only cars emitting 75g/km CO2 or less will be eligible for the 100% first year allowance.

Selwyn Cooper, head of business sales at Volvo Car UK, said: “Our advice to businesses considering a new car is to act now.”

He said missing out on the 100% tax relief available this year, for cars such as the Volvo V40 D2, could mean foregoing thousands of pounds of working capital that could be re-invested in the business this year.

Cooper added: “Losing this tax benefit could therefore force you into buying a car that won’t give you the same premium experience.”

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