2012/13 company car tax bands explained

The company car tax system changed on April 1, 2012, with four new bands to reflect the lower average CO2 emissions of many new cars.

Cars that are zero-rated for CO2 retained their exemption from company car tax, while those that emit 1-75g/km continue to be taxed at 5%.

However, the previous 76g-120g/km bracket has been split into five sections.

The new company car tax bands are split as follows:
• 76-99g/km = 10%
• 100-104g/km = 11%
• 105-109g/km = 12%
• 110-114g/km = 13%
• 115-119g/km = 14%

The 3% surcharge for diesel cars remains, although no car will be liable for more than 35% tax.

This 35% top-level tax will apply to petrol cars that emit more than 220g/km, down from the previous figure of 225g/km.

The changes are designed to reflect the fact that average CO2 emissions for new cars sold in the UK fell from 165g/km in 2007 to 138g/km in 2011.

What Car? company car guide 2012 >>

Company car tax – how it's worked out
Company car tax is calculated using the price of the car, the CO2 emissions and the employee’s income-tax band.

A driver that pays 20% income tax and runs a VW Golf Bluemotion 1.6 TDI emitting 99g/km and costing £20,000 would calculate tax liability as follows:

99g/km = 10% company car tax
10% of £20,000 = £2000
20% of £2000 = £400
Total to pay: annual company car tax bill = £400, or £33.34 per month.

2012-2013 tax bands
Figures for diesel cars with 3% surcharge in brackets.

Zero emission vehicles – 0%
1-75g/km – 5%
76-99g/km – 10% (13%)
100-104g/km – 11% (14%)
105-109g/km – 12% (15%)
110-114g/km – 13% (16%)
115-119g/km – 14% (17%)
120-124g/km – 15% (18%)
125-129g/km – 16% (19%)
130-134g/km – 17% (20%)
135-139g/km – 18% (21%)
140-144g/km – 19% (22%)
145-149g/km – 20% (23%)
150-154g/km – 21% (24%)
155-159g/km – 22% (25%)
160-164g/km – 23% (26%)
165-169g/km – 24% (27%)
170-174g/km – 25% (28%)
175-179g/km – 26% (29%)
180-184g/km – 27% (30%)
185-189g/km – 28% (31%)
190-194g/km – 29% (32%)
195-199g/km – 30% (33%)
200-204g/km – 31% (34%)
205-209g/km – 32% (35%)
210-214g/km – 33% (35%)
215-219g/km – 34% (35%)
220g/km or more – 35% (35%)

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Tom Webster