Fleeting look


With rules around vehicle fleet taxation set to change again, Vehicles for Business, the ECA’s affinity partner for fleet management services, provide an overview of the changes


I majority of cars were low CO2


n April 2009 new changes came into effect that would change the make-up of company car fleets forever. Whether a company leased or bought its cars it was affected – although the impact on fleets where the emitters was minimal. The


new capital allowance system was aimed at rewarding firms running cars that produce CO2


emissions at or under


the 160g/km benchmark. It also penalised those that run vehicles with emissions over that level. The expenditure


on cars above 160g/km attracted a 10 per cent writing down allowance (WDA) (and was grouped into a ‘special rate pool’). Cars of 160g/km or below attracted the normal 20 per cent WDA (and were included in the main plant and machinery pool). The 100 per cent first year capital allowance remained for cars emitting 110g/km or less of CO2


. When the vehicle(s) are to be sold, the sale proceeds


are deducted from the pool, but the balance of any remaining value stays in the pool and continues to be written down. However, as great as some of the above sounds, this is due to change again come April 2012.


Shifting gear With the government increasing VAT to 20 per cent last year, and with a number of changes due to come into effect in April 2012, the balance has definitely shifted onto leasing rather than outright purchase of van fleets.


66


ECA Today January 2012


PJF / SHUTTERSTOCK / ARCHMAN


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