New Green Tax Regime Favours Big 4WD’s

Saturday, 15. November 2008

Good to see that Alphabet, the car leasing company, has spotted something in the new tax rules that are to come into force next April that I reported upon many weeks ago. Under the current rules you can only charge to profit a percentage of the monthly rental cost of a contract hire lease once the cost of the car exceeds £12,000 up to a maximum of a 25% disallowance. This variable rate has now been replaced by a flat rate disallowance of 15% on all cars that emit over 160g/km CO2 which is bad news for lower priced cars that emit more than 160g/km CO2 but great news for the very expensive cars on say a rental of £700 per month. Instead of £175 being disallowed it will only be £105 per month after April next year or in this case £2,660 over 3 years. Anyone want to order a Range Rover? By Graham Hill