Since April 2002, company cars
have been taxed according to their list price
and the CO2 emissions of the car. A percentage
of the list price (generally between 15% and
35%) is taxed dependant on the level of CO2
emissions.
Diesel cars initially attracted
a 3% supplement to reflect the fact that whilst
they generally have lower CO2 emissions than
equivalent petrol cars, they emit higher levels
of other pollutants. However for ‘clean’
diesels (ie those meeting the Euro IV emissions
standards) the 3% supplement was waived. As
announced back in 2004, the waiver for clean
diesels is being abolished from 6 April 2006
for all diesel cars registered on or after
1 January 2006. The enabling legislation is
now in place.
The message is clear - any new
diesel company car registered by the end of
2005 will retain the benefit of the waiver
even after 5 April 2006. On a £25,000
car the waiver is worth £300 a year
to a higher rate taxpayer. Every little helps!
Internet links:
The Regulations can be found
at:
Regulations
For an explanatory memorandum
go to:
The
regulations explained
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