Budget 2016 – Motoring Costs

Fuel prices

Fuel duty was frozen again.

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.Rates through to 2019-20 were announced in the Budget.
As usual, there will be increase to the percentages, so that a higher percentage is payable for each CO2 band each year.  The highest rate remains at 37%.
For example, a zero emission car has a benefit rate of 5% for 2015-6.  This increases to 7% for 2016-7, 9% for 2017-8, 13% for 2018-9 and 16% for 2019-20.
Van benefit

The van benefit in kind charge will increased from £3,150 to £3,170 for 2016-7.The van benefit for zero emission vans will be 20% of the charge for conventionally fuelled vans for 2016-7 and 2017-8.  This will increase to 40% for 2018-9, 60% in 2019-20, 80% in 2010-1 and 90% 9on 2021-2.  From 2022-3, the charge will be the same at that for conventionally fuelled vans.

Fuel benefit

The base figure for calculating the benefit where private fuel is provided alongside a company car will increase to £22,200 (from £22,100) with effect from 6 April 2016.

The van fuel benefit charge multiplier will be £598 (increased from £594) for 2016-7.

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