- BIK taxation levels only published until 2013-14 tax year
- Tax will rise after that, but govt. hasn't said by how much
- Parkers urges govt. to publish BIK bands for next five years
Parkers and Company Car Driver are calling for the government to remain ahead of the curve when publishing BIK taxation information.
As company car tax is on the increase and drivers are paying more and more to use business cars, many company car drivers are choosing cars now without any idea how much they'll have to pay in three years' time.
At present, people who run a company car must pay BIK - or benefit in kind - taxation on their car. The amount paid is calculated using a table published by the government, in which cars emitting certain levels of CO2 are charged a certain percentage of the P11d value of their car.
Until now, BIK taxation has been published for the next three tax years. However the current coalition Government has only seen fit to publish taxation details for the next two years, with no information available for taxation after the 2013-14 tax year.
This means for many company car drivers picking a car now that they intend to keep for more than three years, they don't know how much they'll have to pay in company car tax after the 2013-14 tax year. This makes it next to impossible to budget for running a car for the entirety of the company car lease period.
As fleet managers try to cut costs by extending company car lease periods in an effort to reduce spend on new cars, this problem is likely to become more widespread.
Parkers and Company Car Driver would like to urge the government to publish BIK bands for the next five years, so company car drivers can choose their next car safe in the knowledge that no un-expected costs will be incurred.
To help readers understand the scope of the problem, Company Car Driver has compiled a case study of some popular company cars, how much they cost this year in company car tax and how much they'll cost in the 2013-14 tax year. There's no telling how much the government will increase taxation after 2013-14, so picking your company car and being able to budget for it could be called a bit of a lottery.
List price: £18,665
List price: £23,545
List price: £37,275
You can find out exactly how much your company car tax will be by using the Parkers company car tax calculator
*all costs per month worked out on the 20% pay scale. For 40% tax payers, just double it.