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Company van tax on electric vans
Company provided electric vans will now be subject to company van tax, starting at 20% of the standard Van Benefit Charge for 2015/15

UNTIL the 2015/16 tax year, if you drove a company van that was powered by electricity you payed no benefit in kind van tax.

No more.

Following Budget 2015 company van tax on electric vans is changing; tax will be paid in a tapered rate to eventually meet the company van tax rates paid by drivers of conventionally fuelled business vans.

Company van tax on electric vans – more formally called the Van Benefit Charge – will now be paid at a rate of 20% of the standard company van tax rate, rising in stages to 2020 when it will be equalized.

The standard Van Benefit Charge rate of company van tax for 2015/16 is £3150  on which you then pay tax at your standard rate of either 20% (£630 a year) or 40% (£1260 a year).

So for 2015/16 the company van tax on electric vans is 20% of £3150 (ie £630). So the actual tax payable is £126 for a 20% tax payer; £252 for a 40% tax payer.

 Company van tax on electric vans

Tax year Percentage of standard Van Benefit Charge
2015/16 20%
2016/17 40%
2017/18 60%
2018/19 80%
2019/20 90%
2020/21 100%

 

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