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 top
Car 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 |
Back to top
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 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 |
|
Back to top
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 |
Back to top
