Free fuel becomes more expensive

IF YOU provide your staff with free fuel – is it really worth it?

That’s because staff receiving company-funded fuel used privately will see their benefit-in-kind tax bills rise from April 6.

And with National Insurance rates rising to 13.8% next year, your company will pay more on the employee provided benefit, too.

The Chancellor confirmed in the Budget that the fuel benefit charge multiplier will increase from £16,900 to £18,000, while the van fuel benefit charge – on which tax on ‘free’ van fuel is paid – will increase from £500 to £550.

That means a car with CO2 emissions of 24% will see the percentage charged against their marginal rate of tax increase from £4,056 to £4,320 – which means paying a benefit of £1728 for a 40% tax payer.

If you need to work out if free fuel is worth it for you, go to the ComCar site, which powers our Tax Calculator, and click on the following link: Fuel benefit check.

National Insurance rate rises