Are you looking for a car leasing company that offers nationwide car leasing, but that provides the service levels and dependability you would expect from a local company? Then Car Leasing Made Simple™ is exactly the car leasing provider for you.
Company car tax changes push drivers toward a greener future
As nationwide car leasing companies and an ever-increasing number of disgruntled company car drivers are already aware, the Government began implementing changes to the tax paid by company car drivers to persuade them to select a ‘greener’ car during the 2000s. The Lib-Dem Conservative Government of 2010 reinforced these changes as David Cameron was determined to halve the UK’s carbon deficit “within four years”. To add further fuel to the fire of rising company car costs, his Chancellor introduced a policy to raise an extra 120 million from company car drivers in line with Cameron’s target. This approach has been continued by successive UK governments as BIK (benefit in kind) tax continues its exponential increase on vehicles which are not carbon efficient.
Company car drivers and people with an interest in nationwide car leasing therefore need to fully understand the changes that have been made to ensure they are getting the most out of their company car. The Government’s most recent policy changes mean that the lowest emission producing vehicles, namely electric cars, will see a fixed BIK tax rate of 2% in the coming years. In this way, there has never been a better time for our business leasing and corporate clients to consider our electric & hybrid car lease deals.
Deciphering the jargon
To calculate your company car tax, the government multiplies your car’s P11D value by its BIK tax rate, and the tax bracket which you currently fall into.
The BIK tax to be paid by employees who make use of company cars is determined by three primary factors: the list price (or P11D value), its CO2 emissions, and the fuel type of the car. Cars which are hybrids will also have their tax rate affected by their car’s electric-only range. Fully electric vehicles and plugin-hybrids with an electric range of more than 130 miles are fixed at a BIK tax rate of only 2% until 2025 and then rise by 1% each year until at least 2028 (EB BIK tax rate in 2028 will have risen to only 5%). This is considerably more appealing than the rates charged on traditional combustion vehicles starting from 15% and scaling up to 37% for the least carbon efficient options in 2022, none of which are fixed and are therefore subject to amendment at the end of each financial year.
Environmentalists and nationwide car leasing enthusiasts are welcoming the changes to company car tax, hoping that the increased rates will help in the fight against greenhouse emissions and climate change.
Britain’s government has been putting additional pressures on the Government and nationwide car leasing firms as far as sustainability is concerned. The Government has set a deadline for the year 2030, after which the sale of new petrol and diesel cars and vans will be banned nationwide. Some manufacturers have embraced this target, pushing their own timelines forward, like Vauxhall for example, who plan to switch to selling solely EVs (electric vehicles) before 2028. Our partners Toyota and Kia are also making a positive step towards combatting this issue in line with government policy; as the former, an early adopter of hybrid and EV technology, is committed to going beyond zero emissions; and the latter plans to have 14 EV models in production by 2027 and to use at least 20% recycled plastic in vehicle production by 2030.
The new company car BIK tax rates often leave Business Contract Hire customers confused, uncertain and annoyed as they feel they no longer have freedom of choice, and that they’ll struggle to find the car that is right for them. This goes against our simple and stress-free approach to car leasing entirely, so we’re here to help remedy this. We have a wealth of electric lease deals and hybrid lease deals available, and we’ve put all of them in one easy place for you to browse. If you don’t see anything you like on there, then feel free to search all of our vehicles, but make sure to filter by your desired fuel type. Our account managers would love to tell you about the best offers we have available too, and to help to ensure that you end up driving the car which best suits your needs, so feel free to call us on 08004580113 at your convenience or simply submit an enquiry with us right here on our website.