[MjrPayne]

AS we have been reading these NL tax changes for 2019, I started to wonder how company car benefit is taxed in different countries. In Finland tax is calculated from purchase price. I doesn't matter what energy source is used so EV's being bit more expensive that ICE meaning that you pay more taxes if driving company car. If my coming HSE would have been company car, tax value would be over 1500€/months. That sum added to my salary would cause with progressive taxing 52% of payable tax. So I would end paying about 800€/month to the government if I take a company I-Pace. And being a partner I would end up paying a lease too So much better to get own car and charge work trips from the company. Is there any country charging more than Finnish government?

 

[Snoerd]

Looks similar to the NL. Let's assume the puchase price is 90k in the Netherlands, you will have to add 22% of that value to your income. Income tax is also 52 percent, so you will pay 52% over 20k every month. So 10k net tax, meaning 866 euro's a month net tax.
However, in 2018, there is still an exception that BEV's are taxed 4% instead of the 22 percent to stimulate BEV's (for a maximum of 5 years after purchase). That is what makes the big difference in NL! But that is temporary. In 2019, that 4% benefit is only calculated for the first 50k and all the rest is taxed 22% like any other car. Hence the deadline 1-1-2019... And then 2 or 3 years later, that benefit for the first 50k will also go away and we are back to the same level as Finland (866 netto a month...). But by then, BEV and ICE cars should be priced similarly with lower operational cost, so they should sell themselves. So far the theory... Time will tell...

 

[lvrmsc]

That's a bit cheaper in Belgium. Deductibility of the car cost (amortization and others) by the company is a function of the CO2 emissions. And is still 120% for BEV for now (will drop to 100% by 2019). Electricity costs to "fuel" the car, follow the same rules as for petrol : deductibility is limited based on CO2, though the curve is not the same and the maximum deductibility is 75% for the electricity. The VAT is another thing. Generally it can only be deducted to 50%.
Then on the individual taxes. Benefiting from a company car implies a virtual addition to the revenues used to compute the taxes, which is computed with a rather complicated formula, evolving each year (or about). Though, today for a 100% BEV the formula simplifies (due to the terms involving CO2 being 0) to 4% of the full VAT-included catalog-price of the car including options. What you pay in the end (the invoice) for the car does not count: only the public catalog price. Considering that a nearly top of the line I-Pace is about 100k€ (including 21% VAT), that is about 4 k€ added to the yearly income, before applying taxes. That still is really fair, to say the least. But only on BEV, a 100 k€ ICE car with a nice engine as it would, is much more.
There are no other incentives to push EVs in Belgium and the public charging infrastructure is still stone-age like. So at least, playing electric we pay less taxes that ICE cars. It won't be long before they change their minds though.

 

[ChrisMc]

In the UK it's a minefield :lol:

What is company car tax?
If you drive a car that has been provided by your employer, and you can use that vehicle for personal transport outside of work, then it's considered a company car and is seen as a taxable perk by HMRC. As a result, there is tax to pay.

Officially a company car is known as a Benefit In Kind (BIK), because there is a monetary value attached to your ability to use it privately. HMRC view it as an additional bonus on top of your annual salary, because the car is paid for by your employer in addition to your standard pay.

BIK (Benefit in Kind) rates are primarily based on a car's CO2 emissions, because the government has decided that the best way to help reduce the overall emissions of cars in the UK is to offer tax incentives to businesses that provide staff with company cars.

That's the basic foundation of BIK tax, but the amount you actually pay is determined by the list price of the car you're looking at, combined with the personal tax rate you're on (20%, 40% or 50%). The price of the car will be its list price before non-taxable items (first-year VED road tax, first registration fee, telephone installations, etc), but will also include the cost of any options.

In addition, the amount of tax you pay will be determined by the fuel you put in your car. In the past, pure electric vehicles (EVs) were exempt from taxation, but as their take-up has increased, HMRC has seen fit to include them on BIK rates, :evil: albeit at a substantially lower rate than conventional models. The low emissions of plug-in hybrid vehicles mean they're a popular interim solution while full-electric cars increase their range and rapid charging ability, as they can be driven like conventional cars, but have BIK rates that are far lower.

HMRC works out the amount of BIK tax you pay based on the amount of CO2 emissions a car emits. There are 21 emissions bands, starting with vehicles that emit 0-50g/km, ranging up to those models emitting 180g/km or more, and the amount of tax you pay is a percentage of the car's list price, which HMRC refers to as the P11D value. This is the price of the car with optional extras included, but minus the non-taxable parts of the vehicle, including the first year's VED (road tax) and its first registration fee. The P11D value is determined by the list price quoted by a manufacturer, so even if you get a discount on a new car's list price, the P11D value will remain unchanged.

As a Business owner, I find it much better and cheaper to just buy the car myself and then bill my company a rate per mile for every mile I use it, covering fuel costs and wear and tear for work.

 

[Jelle v/d Meer]

The NL government is really good at coming up with fiscal stimulation for environmental friendly cars to only fail in everything that desired to achieve at a very high cost to the Dutch tax payers.

Previous major error was with plug in hybrids that for a short while got 0% tax rate because the NEDC emission was theoretically low due plug in function. Reality is that very few people used the plug in charger and that fuel consumption and CO2 emissions were MUCH higher.

At the moment I drive a Skoda Octavia Greenline which Skoda modified exactly so they got to target CO2 emission for 14% tax instead of 20% tax. So great for me as I pay just €187 per month instead of €265 but no way I can achieve the fuel efficiency of 3.2L/100km. If I achieve 4.0L/100km I am doing really well most of the time it is 5.0L/100km or more.

In terms of BEV like Snoerd explained in 2018 the tax is 4% on new value of the car, from 2019 it is 4% on first 50k and 22% above. The good thing with BEV is that the car emission will be REALLY 0 CO2 but the electricity still need to be produced and Jaguar's claim of 22kW/100km is just to be proven accurate with test so far (with pre-production) showing much higher usage. For me it doesn't matter because I can drive a car that is 3x more expensive than my Skoda is yet pay approx €150 per month so less than for the Skoda :lol:

Coming back to the failure of NL government - these fiscal incententives really disrupt the market, a short term, often only for company cars and when the cars come out the lease most end up being exported thus removing the environmental benefit for NL.

 

[Jelle v/d Meer]

In the UK it's a minefield :lol:

UK is very similar than NL with 2 key differences - UK government seem to play the long game and because you have 21 rates versus NL just 2 (previously 4) the disruption on the market is much less.

What you see in NL now due to only 2 rates (4 % for BEV/Hydrogen and 22% for anything else) is that it no longer matters for people if they put a fuel efficient 1.6l diesel engine in the car or a high power 3.0l V6 petrol engine. The only difference is in car sales tax (BPM) - the higher the CO2 the higher the tax.

So you pay the same 22% tax on a €40k VW Polo with 3.0l V6 petrol engine than on a €40k VW Passat with 1.6l diesel engine. Yet the emission levels are miles apart.

 

[DrPhil]

In the UK it's a minefield :lol:

UK is very similar than NL with 2 key differences - UK government seem to play the long game and because you have 21 rates versus NL just 2 (previously 4) the disruption on the market is much less.

What you see in NL now due to only 2 rates (4 % for BEV/Hydrogen and 22% for anything else) is that it no longer matters for people if they put a fuel efficient 1.6l diesel engine in the car or a high power 3.0l V6 petrol engine. The only difference is in car sales tax (BPM) - the higher the CO2 the higher the tax.

So you pay the same 22% tax on a €40k VW Polo with 3.0l V6 petrol engine than on a €40k VW Passat with 1.6l diesel engine. Yet the emission levels are miles apart.

To be more specific: you don't pay 22% nor 4% tax but your tax income is raised by 22% or 4% of the price of the car and you pay appx 35-51% incometax so max 2% or 11% over - let say € 90.000,-.