I want to talk about two company car tax drivers, let’s call them Anabella and Brenda. It’s April 2020. Anabella works in London for a PE house – she’s got a Porsche Taycan, List Price £120,000. She only does 8,000 miles a year, all private, mostly to the station in Bexhill. She pays tax at 45%.
Brenda drives 35,000 business miles a year in a 3 year old £25,000 Passat Estate 2.0D SE, servicing her clients across the North East, and she pays tax at 20%. She doesn’t do many private miles because, let’s face it, she drives enough during the week.
• Anabella is paying £90 a month in tax [£120,000 x 2% x 45%], she spends more than that in Pret.
• Brenda is paying £133 [£25,000 x 32% x 20%].
Something seriously wrong here? We’ve worked on literally hundreds of cases like Brenda. For some they’ve chosen to switch to vans but these tend to have higher WLC, and are more damaging to the environment. Of course Brenda could switch into an electric or PHEV if only they were available at that price point with a range that would comfortably handle 300 or more miles a day servicing 4 to 5 separate clients.