Company Cars: Is a Fuel Allowance Worth it?

Xus NEXUS Vehicle Rental COMPANY CARS: IS A FUEL ALLOWANCE WORTH IT? मामि -- - - If you receive a company car as part of your remuneration benefits, you may also be offereda free fuel allowance for private use. Free fuel is great, but remember you will be taxed on it, and the amount will vary depending on the car you receive and how much CO2 it produces. So how do you know whether you're better off taking a fuel allowance, or paying for your own fuel? Below we show you how to calculate the amount of tax you will pay using a Renault Megane Hatchback as an example. RENAULT MEGANE HATCHBACK GT NAV DCI 165 EDC AUTO 5D FIND YOUR CAR'S BENEFIT PERCENTAGE This figure is dependant on how much C02 your vehicle produces. The more C02 produced, the higher the percentage. Look in your log book, or online to find out how much C02 your car produces. C02 emissions tables showing the corresponding benefit percentage can also be found online. C02 emissions (g/km) 2018/19 110-114 23% 115-119 24% Diesel vehicles must add an additional 4% 120 25% 25% + 4% = 125 26% 130 27% 29% Full table not shown here. MULTIPLY THE BENEFIT PERCENTAGE BY THE BENEFIT CHARGE FIXED FIGURE The benefit charge fixed figure is a notional figure set by the Government. For the tax year 2018/19, the fixed figure is £23,400. 29% x £23,400 = €6,786 Benefit percentage Benefit charge fixed figure MULTIPLY BY YOUR RATE OF INCOME TAX At the time of publication income tax rate bands are 20% and 40%. Take the end figure from stage 2 (£6786 in this case) and multiply by your tax rate percentage. For the purpose of this illustration we will use the lower 20% rate. £6,786 x 20% = Figure from stage 2 Income tax rate TAX PAYABLE ON FUEL ALLOWANCE £1,357.20 Annual self-paid fuel costs £1,357.20 If this figure is less than what it would cost you to fuel your car for the year, then a fuel allowance would be beneficial to you. If it is higher then you are better off paying for your own fuel. Nexus is the UK's leading tech-driven business mobility provider, with nearly 20 years' experience as a pioneer in developing innovative technology to make business mobility efficient and effective. Nexus' revolutionary online rental booking and management platform, IRIS, developed in-house by a specialist IT team, is central to its success. The system allows business customers to access over 550,000 vehicles, including 100,000 specialist and commercial vehicles and 50,000 HGVSS, across more than 2,000 UK locations. Nexus can source any vehicle, anytime, anywhere, and can usually deliver within two hours of a booking being made. Contact Nexus today: www.nexusrental.co.uk in