Tuesday, February 14, 2012
QUALEC rules to be abolished
Special regulations for qualifying low emissions cars (QUALECS) - those with CO2 emissions not exceeding exactly 120g/km - are to be scrapped from 6 April 2012.
QUALECs are cars registered on or after 1 January 1998 with a CO2 emission figure that does not exceed the statutory limit for the tax year - currently standing at 120g/km.
Businesses offering company cars will be affected by the revisions, which will change car benefit charges.
In the UK car benefit charges are calculated by multiplying the price of a car, including accessories and any reduction in capital contributions the vehicle may have, for tax purposes.
Changes to the system will place further pressures on businesses to switch to green fleet models, as operators are required to pay Class 1 A National Insurance on the scale charge of any car offered to employees for private use.
Consequently, increases to the CO2 relevant percentage will impact upon business costs at a time when companies are already under financial pressure from rising fuel costs and new Low Emission Zone regulations.
Employees will also face charges as CO2 relevant percentages increase. Workers who use a company car are required to pay Benefit in Kind tax on the scale charge, which will rise if they are using a high emission vehicle.
New regulations coming into effect this year will see revisions to the lower threshold and the lowest appropriate percentage.
The lower threshold, the approved CO2 emissions figure which calculations of the appropriate percentage are based upon, will be reduced from 125g/km to 120g/km, with a further drop expected in 2013-2014.
Cars with an emission level of 99g/km will also receive a 10% lowest appropriate percentage scale rate, increasing to 11% for vehicles with emissions of 100g/km and rising by one percentage point for every 5g/km to the current maximum of 220g/km emissions (35%).
The 10% rule on lowest percentage cars will be applied to vehicles with CO2 emissions of 76g/km to 94g/km from 2013-2014.
It is hoped that the new standards will act as an incentive to businesses to choose more environmentally friendly vehicles as a means to reduce costs and their carbon footprint.
Dr Ben Lane, managing editor of Next Green Car, commented: "More drivers will find their motoring needs met by a hybrid, or by a plug-in hybrid which offers the ultimate combination of conventional and electric drive-trains.
"The good news is that all these options offer a new and improved driving experience, and can reduce running costs as well as emissions."
QUALECs are cars registered on or after 1 January 1998 with a CO2 emission figure that does not exceed the statutory limit for the tax year - currently standing at 120g/km.
Businesses offering company cars will be affected by the revisions, which will change car benefit charges.
In the UK car benefit charges are calculated by multiplying the price of a car, including accessories and any reduction in capital contributions the vehicle may have, for tax purposes.
Changes to the system will place further pressures on businesses to switch to green fleet models, as operators are required to pay Class 1 A National Insurance on the scale charge of any car offered to employees for private use.
Consequently, increases to the CO2 relevant percentage will impact upon business costs at a time when companies are already under financial pressure from rising fuel costs and new Low Emission Zone regulations.
Employees will also face charges as CO2 relevant percentages increase. Workers who use a company car are required to pay Benefit in Kind tax on the scale charge, which will rise if they are using a high emission vehicle.
New regulations coming into effect this year will see revisions to the lower threshold and the lowest appropriate percentage.
The lower threshold, the approved CO2 emissions figure which calculations of the appropriate percentage are based upon, will be reduced from 125g/km to 120g/km, with a further drop expected in 2013-2014.
Cars with an emission level of 99g/km will also receive a 10% lowest appropriate percentage scale rate, increasing to 11% for vehicles with emissions of 100g/km and rising by one percentage point for every 5g/km to the current maximum of 220g/km emissions (35%).
The 10% rule on lowest percentage cars will be applied to vehicles with CO2 emissions of 76g/km to 94g/km from 2013-2014.
It is hoped that the new standards will act as an incentive to businesses to choose more environmentally friendly vehicles as a means to reduce costs and their carbon footprint.
Dr Ben Lane, managing editor of Next Green Car, commented: "More drivers will find their motoring needs met by a hybrid, or by a plug-in hybrid which offers the ultimate combination of conventional and electric drive-trains.
"The good news is that all these options offer a new and improved driving experience, and can reduce running costs as well as emissions."
DATED: 14.02.12
FEED: HC
