Tax Regulations

One of the primary design features of ABAX Triplog is to be an aid in the war against tax. It is not just a requirement for our product to be tax compliant, our employees are also experts in the complex field of vehicle taxation law. Let ABAX help you calculate the Benefit In Kind charge and fuel benefit charge for your company car or van. Speak to us now to see how this figure can be reduced. Email us at info@abax.co.uk or tel: 01733 698888

Tax Guide.pdf (2 MB)

COMMERCIAL VEHICLES

Tax regulations surrounding the use of commercial vehicles at work are very simple. Yet judging by the number of companies who operate outside of these rules, it would suggest otherwise.

Company light commercial vehicles used privately incur benefit-in-kind tax for the driver, based on a taxable value of £3,150 in 2015/16. The charge will increase by the rate of inflation in 2016/17. Electric vans are no longer exempt from benefit-in-kind tax until the end of the 2015/16 financial year.

If free fuel is also provided by the employer for private mileage, an additional van fuel benefit charge applies. The charge for 2015/16 has increased from £581 to £594. It increases by the rate of inflation in 2016/17.

An electrician provided with a van and free fuel, who is a basic rate tax payer and uses the van privately, will incur a taxable benefit charge of £3,744. The tax paid by the employee would therefore be £748.80. The business would also pay Class 1A NIC's of £516.67.

COMPANY CARS

Around 1 million people in the UK drive a company car. The taxable benefit is calculated as a percentage of the list price of the car, on the day before it was first registered, plus certain accessories. This percentage depends upon the rate at which the car emits carbon dioxide (CO2), and the fuel type. Zero Emission Vehicles are no longer exempt from benefit taxes.

Where the employer also provides free fuel, a fuel benefit charge is applied. The taxable car fuel benefit, for 2015/16, is calculated by applying the CO2 based car benefit percentage to the car fuel benefit charge multiplier of £22,100.

If the employee pays for the full cost of all fuel for private journeys there will be no car fuel benefit. In all other cases the full tax charge will be due. To avoid the benefit, the employee will typically pay for their own fuel and reclaim the cost of business mileage from their employer. Alternatively, the employer can continue to pay for all of the fuel and the employee reimburses their employer for cost of any private mileage.

For the latest HMRC advisory fuel rates, click here

PRIVATE CARS

Over 4 million privately owned vehicles are used for work purposes in the UK. It is normal practice for employees to be reimbursed at a reasonable mileage rate for business use of their own vehicles.

Similar to with company cars, HMRC publishes Approved Mileage Allowance Payments (AMAP's). Providing that the employee is not reclaiming at rates higher than than the AMAP's, this does not need to be reported on the P11D. Therefore no tax or NIC's are payable.

The standard AMAP rate for cars is £0.45 per mile for the first 10,000 business miles and £0.25 there after.

For more information on AMAP's, click here