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Why a commercial vehicle is tax efficient

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Friday 04 May 2012

Tags: tax efficient vans

Why a commercial vehicle is tax efficient

When Mr Osborne delivered his Budget speech, he told us some great things; a pity that some of the 'bad news' was hidden away and only became apparent when I read the full Budget report (yes, all 114 pages - a great cure for insomnia!) Someone driving a company car with a CO2 of 120 g/km for example is in for a big shock - the Benefit in Kind (BiK), or company car tax as it's known, will rise by 110%* over five years. All company car BiK is rising, and by a lot more than inflation. If you are a company car driver, email us for details of your tax rise over the coming years, however, we recommend you sit down before you read it!

If you drive a pickup as a company vehicle, it's still classed as a commercial vehicle so the same tax rules apply. Currently they are taxed at a flat rate of £3,000 per annum (no change in this year's Budget). This means that your annual tax bill would be £600 for a 20% tax payer and £1,200 for a 40% tax payer (yes, just £100 per month). If you get private fuel for your company commercial it gets better, as you are taxed on just £550 per annum. Quick example: a 40% tax payer, with a commercial vehicle with private fuel pays £118 per month BiK whilst the same person in a typical company car would pay £377** per month BiK- and it gets worse each subsequent tax year!

Also, don't forget the versatility you get with a pickup, i.e. with the right accessories you have 'van like space' in the backto carry tools and materials, whilst having 'car like comfort' in the front. In addition, you can also have other things, like 4x4 capability (2 vehicles in 1). Pickups today are more efficient engines than their predecessors, i.e. euro 5 engines.So, it makes sound financial sense to consider a pickup as your next company vehicle: call us for details and to arrange a test drive. The only decision you have to make is what to spend all that tax you save on!

*From 05/04/12 to 06/04/17

**Based on a P11d price of £25,000, in the tax year 12/13, a CO2emission of 155 g/km, diesel powered and private fuel provided

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About Andy

Andy has worked in the motor trade and more specifically been involved in supplying finance for vehicles, coming up to 20 years. He started his own business www.autorama.co.uk in 2004 selling used vehicles before expanding the company via its comercial vehcle leasing business in 2006. Back then the leasing business was pretty much just him, a laptop and a portakabin. Now just six years later Autorama through it's online brands vanarama.co.uk and pickuptrucksdirect.co.uk is recognised as the largest independant commercial vehicle leasing broker in the UK.

The last six years have seen continued growth and resulted in the company now employing 32 staff. Being able to offer some of the most competative rates in the country as well as industry leading levels of customer service have played a big part in our growth. However it is our ability and moreover our expert knowledge in this sector that has allowed us to best advise and therefor better serve our customers.

Every customers needs are different and there are so many options available that it's easy to see why people get confused by either inaccurate or simply poor advice. We are here to help and advise you so whatever your query, no matter how big or small your business or how complicated your situation seems. let us answer your van leasing questions.

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