CO2 emissions - Lower tax costs for green cars!

September 2005

Under present legislation if you buy a company vehicle with a CO2 emissions rating below 121g/km, your business can write off the total cost of the vehicle for tax purposes in the year of purchase.

Additionally the user of the vehicle will suffer the lowest rate of benefit charge for the use of the car. The benefit in kind for the use of a company car varies between 15% and 35% of the list price when new. Under 121g/km the lower rate of 15% applies.

With oil prices climbing the financial and other tax benefits of buying a car with a lower CO2 rating are compelling.

For example according to government statistics the car with the lowest CO2 rating (petrol use) in the UK is the Honda Insight. This hybrid petrol/electric car is rated for CO2 emissions at just 80g/km. Fuel consumption is 83mpg!

The top five petrol vehicles are:
1.Honda Insight 80g/km
2.Toyota Prius 104g/km
3.Peugeot 107 109g/km
4.Toyota Aygo 109g/km
5.Smart City Coupe Hatchback 113g/km

If you would like to see the top 10 petrol and diesel cars visit www.vcacarfueldata.org.uk/information/tables.asp

Whilst not everyone will be drawn to these types of vehicles for a company car, as a second car it may be an appealing choice?