Budget 2013 – Motoring Costs

Fuel prices

The Chancellor announced that the increase in fuel duty due on 1 September 2013 would be cancelled.

Business mileage payments

HMRC sets an approved mileage allowance payment (AMAP) rate. This is the rate at which employers may reimburse business mileage tax free.

Businesses with a turnover of less than the VAT registration threshold (£79,000 from April 2013) can also choose to claim a tax deduction for their vehicle costs at the AMAP rate, rather than recording all vehicle expenditure and claiming the actual costs.

The AMAP rate will remain at 45p for the first 10,000 miles per annum and 25p per mile for any excess.

Company Cars

Car benefit

As announced in Budget 2012, the percentages for calculating company car benefits will increase by 1% from April 2014 for all vehicles with carbon emissions of over 75g, up to a maximum of 35%.

In addition in both 2015/16 and 2016/17 the percentages will be increased by two percentage points and the maximum percentage of the list price subject to tax will increase to 37%.

From April 2016, the three percentage point diesel supplement will be removed so that diesel cars will be subject to the same level of tax as petrol cars.

It was announced in Budget 2013 that two new percentage bands for company cars emitting 0-50g of carbon dioxide per kilometre (with appropriate percentage set at 5 per cent) and 51-75g CO­2 per km (with the appropriate percentage set at 9 per cent) will be introduced from 2015-16.

Fuel benefit

The base figure for calculating the benefit where private fuel is provided alongside a company car will increase to £21,100 (from £20,200) with effect from 6 April 2013.

The van fuel benefit charge multiplier will be £564 (increased from £550) for 2013-14.


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