Fuel duty was frozen again.
Vehicle Excise Duty (VED)
VED (Road Tax) for cars, vans, motorcycles and HGVs will increase in line with the Retail Price Index from 1 April 2020.
The Budget papers also announce that all registered zero-emission light passenger vehicles registered from 1 April 2017 until 31 March 2025 will be exempted from the VED supplement for light passenger vehicles with a list price exceeding £40,000, starting from April 2020.
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.
Car benefits are based on a percentage of the list price of the car. The percentage depends on the CO2 emissions of the vehicle.
It was announced previously that, for cars registered from 6 April 2020, the calculations for CO2 emissions will be based on Worldwide harmonised Light vehicles Test Procedure (WLTP
). WLTP are emissions tests that
aim to provide a closer representation of ‘real-world’ fuel consumption and CO2 emissions. These are generally higher than the old measure (New European Driving Cycle (NEDC
)), so there are now different percentage charges for pre-April 2020 (based on NEDC) and post April 2020 (based on WLTP) registered vehicles.
The rates for 2020-21 to 2022-23 can be found on pages 4 and 5 here.
Note that there will be a 0% benefit rate for zero emission cars for 2020-21 (increasing to 1% in 2021-22 and 2% in 2022-23 and returning to ‘normal’ in 2023-24)
The van benefit in kind charge will increased from £3,430 to £3,490 for 2020-21.
The benefit for zero emission vans will be reduced to zero from 6 April 2021.
The base figure for calculating the benefit where private fuel is provided alongside a company car will increase to £24,500 (from £24,100) with effect from 6 April 2020.
The van fuel benefit charge will be £666 (increased from £655) for 2020-21.