Budget 2015 – Motoring Costs

Fuel prices

The fuel duty increase due in September has, again, been 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.

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

Car benefits are based on a percentage of the list price of the car.  The percentage depends on the CO2 emissions of the vehicle.

As usual, the increases to the percentages were announced, so that a higher percentage is payable for each CO2 band.  So, for example, a car with 50g CO2 emissions has a multiplier of 7% in 2016-17, 9% in 2017-18, 13% in 2018-19 and 16% on 2019-20.  One with 160g emissions is 29%, 31%, 33% and then 36%.  The highest rate remains at 37%.

Van benefit

The van benefit in kind charge will increased from £3,090 to £3,150 for 2015-16.

As announced at Budget 2014, legislation will be introduced in Finance Bill 2015 to increase the current van benefit charge of £nil for vans which do not emit CO2 (zero emission vans), beginning in 2015-16. The van benefit charge for zero emission vans will be 20% of the value of the van benefit charge for vans which emit CO2 in 2015-16, 40% in 2016-17, 60% in 2017-18, 80% in 2018-19 and 90% in 2019-20. From 2020-21, there will be a single van benefit charge applying to all vans.

Fuel benefit

The base figure for calculating the benefit where private fuel is provided alongside a company car will increase to £22,100 (from £21,700) with effect from 6 April 2015.

The van fuel benefit charge multiplier will be £594 (increased from £581) for 2015-16.

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