How to reduce your company car tax bill

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No one likes paying tax and with a few canny moves you can pay less of it on your company car. We show you how.

To mangle an old saying, only two things are certain in this world: death and company car tax. You can't avoid the first and however you try to dodge the second, you'll always end up paying something. Of course, this assumes you have a company car but with around 700,000 people in receipt of one, the chances are reasonably high. To the tax man, a company car is a cash cow with, in the tax year 2021/22, the total taxable value of company car benefit amounting to £3.95 billion.

For context, a 20% taxpayer in a £30,000 Vauxhall Astra GS Line diesel would pay around £158 in benefit-in-kind per month, whereas their boss on a 40% income tax band would pay just £83 for a £120,000 BMW iX M60. It’s hardly surprising that battery-electric has become the most popular powertrain type for new fleet lease cars, according to the British Vehicle Rental and Leasing Association .

 

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