Fleets increasingly seeking external advice regarding April tax changes, says Arval
Fleets are increasingly seeking external advice to work through the
implications of new tax regulations that will take effect from April this year,
according to Arval.
The vehicle leasing and fleet management company says
that the headline changes - affecting benefit-in-kind tax for drivers entitled
to a cash option or a company car, salary exchange schemes and Vehicle Excise
Duty - required careful thought and planning.
Richard Cox, senior fleet consultant, said: “In recent years, annual changes to
tax affecting company cars have been incremental and signposted some way in
advance. However, the new changes have been more sudden and, for that reason,
caught some fleets off-guard.
“Certainly, we are hearing from a number of businesses asking for expert input
which is absolutely the right thing to do. Some elements taking effect in April
do not always have obvious solutions and, for this reason, we have been asked
for help by a relatively large number of vehicle operators.”
As a result of the nature of the changes, Mr Cox added, consultancy services
were especially being sought by fleet stakeholders such as human resources and
finance departments - as well as from fleet managers themselves looking to
understand all of the options available to them.
He said: “The cash option question, for example, is one that is being pondered
by many HR managers. There are several tricky issues to consider when making
this decision, such as whether individual cash options represent a fair
equivalent of a company car, the kind of vehicles that employees are choosing
to buy with their cash allowance and more.”
The Vehicle Excise Duty changes, which completely alter the rules for what
would previously have been considered low emissions vehicles, could also
require expert help, said Mr Cox.
He continued: “There are a number of questions arising from the new Vehicle
Excise Duty rates but perhaps the trickiest is that for cars registered after 1
April, only 0g/km models now attract a zero charge instead of those up to
100g/km, as at present. This could affect overall running costs and therefore
some fleets are looking at repositioning their choice lists to reflect the
“These are issues that fleets are still working through and our consultants
have been finding that, while sensible solutions can be found, there is no
one-size-fits-all answer. It is a matter of sitting down with each and deciding
on their individual priorities.”