Businesses are unprepared for company car tax changes

Almost half (48%) of British senior managers with decision making responsibility for company cars say their businesses are unprepared for the changes to company car taxes that come into force this week, research suggests.

Almost half of senior managers surveyed say their businesses have not changed their fleet policy in preparation for the incoming tax rules, says LeasePlan.

However, if a business has not been properly prepared, the changes are likely to escalate the cost of a company car due to a change in the CO2 thresholds used to calculate a number of tax allowances.

More than half (51%) of senior managers questioned in the YouGov poll agreed that the new tax changes would place further financial strain on their business, with more than a third (38%) saying they would be interested in guidance on how to manage the new legislation.

When asked whether they believed that life was harder or easier for business drivers now, compared to 12 months ago, almost half (47%) said it was “harder” or “a lot harder”.

In a separate survey, business drivers also expressed concern about the changes, with 37% saying they would benefit from guidance on how to minimise the effects of the change in legislation.

Despite the significance of the tax changes, almost nine in ten (89%) of the same group said they were unaware of the incoming legislation.

David Brennan, Managing Director, LeasePlan, said: “These tax changes have been introduced with the laudable intention of promoting the adoption of lower-emitting vehicles.

“However our research shows that fleet managers and drivers may not be aware of, or adequately prepared for the specific tax impact these measures may have on their business. 

“Our research has made it clear that there is an appetite for specialist advice around understanding these technical measures, and if explained properly, there is no need for companies to fear the impact upon their fleets.

“To this end, LeasePlan has engaged in a far-reaching programme of tax optimised solutions and presentations, delivered before the April 1 deadline, to ensure our clients are fully prepared.”