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Finance Bill draft changes: Cars

Posted on 9 Jul 2018

2 min read

On Friday, the Government announced a raft of draft clauses for the Finance Bill for the 2019/20 tax year. There were three announcements made in respect of cars:

1. Changes to Optional Remuneration Arrangements rules for taxable cars and vans

The Finance Bill will amend two aspects of how cars and vans are taxed if they are subject to OpRA rules from 6 April 2019. Firstly, when considering the ‘amount foregone’, this will in future include amounts in respect of the provision of the vehicle plus any amounts in respect of any connected costs. This means that the current practice of apportioning the ‘amount foregone’ for cars or vans will no longer be appropriate.

The second change affects capital contributions. The amount of capital contributions taken into account will be reduced proportionally from 6 April 2019 if the car is only available for part of the tax year.

2.Workplace charging for all-electric and plug-in hybrid vehicles

A new exemption will apply to workplace charging facilities for employee-owned electric and hybrid cars, applying retrospectively from 6 April 2018. Where employer-owned electric cars are charged at the workplace, this is already exempt from an income tax charge.

3.Changes to the Income Tax and National Insurance contributions treatment of emergency vehicles

New easements will be introduced for drivers of emergency vehicles, some of whom were negatively affected by the new ‘use of assets’ legislation introduced in 2017. The changes will apply retrospectively from 6 April 2017.

This information was provided by Ogilvie’s tax partner Deloitte. For more information, visit our dedicated tax pages here.



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