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ELECTRIC CAR TAX BENEFITS
Manufacturers are investing billions into the development of electric cars and hybrid vehicles and as a consequence more businesses are offering these alternative fuel vehicles as part of their benefits package. Tax cuts brought in from April 2020 will make electric vehicles an even more attractive option.
From April 2020 all new registered cars will have their emission levels for company car tax purposes determined under a new standard known as WLTP (Worldwide Light vehicles Test Procedure). All electric car drivers will see their rate of company car tax reduce to 0%, assuming their vehicles can travel 130 miles or more on a single charge. There will be a sliding scale up to 14% for vehicles only capable of travelling 30 miles or less on battery power.
Car benefits for full electric (zero emissions) cars are also being reduced to 2% of the list price from April 2020 (and benefits for hybrids also falling).
If you are thinking about changing your company car remember your business may get 100% writing down allowance in the first year. For advice on the tax benefits of an all-electric or hybrid car might provide, please get in touch.
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