Move fast to maximise relief on low CO2 vehicles

If you act fast you can still claim 100 per cent tax relief on low emissions cars for your company. Here’s how:

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If you’re planning to make the most of your company’s fleet of vehicles, consider the 31st March a red letter day*. Until that date, businesses purchasing new cars with emissions of 95g/km or less are eligible for 100% tax relief, allowing the whole purchase price to be deducted from the company’s taxable income.

From April, however, the threshold changes, meaning that emissions can’t exceed 75g/km if you’re to qualify for the full writing down allowance. True, cars that don’t qualify are still eligible for an annual deduction** of either 8% or 18%, depending on emissions, but this is still a big deal. Buy a Peugeot 308 1.6 BlueHDi Allure with emissions of 84g/km, and a company paying tax at a rate of 20% may claim tax relief for the year of purchase of £4,189 if they buy in March. Buy in April, however, and you’re looking at tax relief of just £754 in the first year.

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