BIK rates finally confirmed? - Budget 2020

[Jason71]

believe it or not the planned cut in BIK has never actually been enshrined in law I hope this now does that. the only reference to it is this:

2.227 Company car tax (CCT): Rates – As set out in July 2019, (24_ the government will reduce most CCT rates by 2% in 2020-21 for cars first registered from 6 April 2020. Rates will return to planned levels over the following two years, increasing by 1% in 2021-22 and 1% in 2022-23. Rates will then be frozen until 2024-25. (66)

but reference 24 is the document on which it has all been based
https://assets.publishing.service.g...17_-_WLTP_-_summary_of_responses_v2.2__1_.pdf

which includes
3.13 In response, an appropriate percentage of 0% will be introduced for all zero emission company cars in 2020-21 (including those registered before 6 April 2020). By providing clarity of future the appropriate percentages, businesses will have the ability to make more informed decisions about how they make the transition to zero emission fleets.
Table 3.B: Company car with CO2 emissions figure of 0g/km Year 2020-21 2021-22 2022-23 Appropriate percentage 0% 1% 2% Difference (compared to 2020-21 planned rates, ppt) -2 -1 0

so vague as it is I hope this means its all going ahead as we thought

 

[WannabeOwner]

I've worked on the basis that 2% was OK, even if the 0% didn't happen ...

last year the EV BiK was ridiculously high (still far better than ICE ... but ...), compared to previous / following years, due to Government cock-up ... not telling that won't happen again.

 

[Jason71]

I've worked on the basis that 2% was OK, even if the 0% didn't happen ...

um the current rate is 16%. Theoretically it stays at that for already registered vehicles unless changed by this budget. not trying to scare monger existing owners I'm pretty sure it will but the way its written in the budget is not entirely unambiguous.

 

[NickC84]

Page 4:

https://assets.publishing.service.g.../file/871928/Annex_A_Rates_and_Allowances.pdf

 

[WannabeOwner]

Theoretically it stays at that for already registered vehicles unless changed by this budget.

My understanding, from my accountant, was that the 2%/similar was already decided and the 0% was "promised" subject to confirmation

Wouldn't be the first time I've got the wrong end of the stick though ...

 

[Jason71]

My understanding, from my accountant, was that the 2%/similar was already decided and the 0% was "promised" subject to confirmation

Wouldn't be the first time I've got the wrong end of the stick though ...

you may be right. I thought that decided or promised none of it was actually enshrined in law yet but I might be wrong it might just be the second bit that was outstanding. So long as it happens now I don't mind. There would be a fair few M3's up for sale ( mine included) if I had to carry on paying 16% for the next few years.

 

[PipPip]

The policy document published today says "Drivers of zero emission vehicles (ZEVs) under both the NEDC and WLTP procedure will benefit from the zero percent for the tax year 2020 to 2021.". Seems pretty clear to me that they are implementing 0% for all ZEVs from April regardless of registration date.

 

[planehazza]

If 0% BIK does not happen I'm screwed. I was promised by my broker it was going ahead and was told the monthly cost would drop automatically in April so went with the order.

 

[PipPip]

A friend works in the fleet industry and share this article which confirms that the BIK rate is 0% on ZEVs whether registered before or after 5 April. Budget 2020: New company car tax rates announced

 

[HornetBrad]

um the current rate is 16%. Theoretically it stays at that for already registered vehicles unless changed by this budget. not trying to scare monger existing owners I'm pretty sure it will but the way its written in the budget is not entirely unambiguous.

I agree but hopefully this gives us more (but not 100%) comfort - the fact it mentions "...company cars EITHER reporting zero emissions OR first registered after 6 April 2020..." would indicate it's for ALL ZEVs. But I concur that it's still not clear!

 

[TommyT10]

Budget 2020: New company car tax rates announced

Seems to suggest that the BIK rules are confirmed exactly as were previously stated so applies to both pre and post April 6th

 

[Reddom]

Does anyone know if the exemption on BiK vs Cash alternative for ZEV has continued?

 

[Jigstar]

https://publications.parliament.uk/pa/bills/cbill/58-01/FinanceDocuments/Resolutions Book.pdf


And it is declared that it is expedient in the public interest that this Resolution

should have statutory effect under the provisions of the Provisional Collection of
Taxes Act 1968.

The above should mean that the 0% BIK rate will be confirmed into statute before 6 April 2020 (as opposed to waiting for the Finance Bill to go through various stages in Parliament - where it would formally get confirmed around August / September time)

 

[Jigstar]

Sorry - should have said -page 21 is where it confirms the rates and the above PCTA 1968 reference.

 

[Rob R]

It is very common for budgets to make changes to tax rates "from 6pm tonight" and such like. It used to be an annual ritual to rush out to fill the car up before the prices rose later that day. None of this was law. It was made law with the passing of the Finance Bill into law, often months later. It had retrospective effect, and everyone knew it was going to have retrospective effect. Really, the only circumstance that this would not work is if the Finance Bill was defeated. With a Conservative majority of 80, and most of them delighted by the Budget, there is no chance of that.

 

[Jason71]

It is very common for budgets to make changes to tax rates "from 6pm tonight" and such like. It used to be an annual ritual to rush out to fill the car up before the prices rose later that day. None of this was law. It was made law with the passing of the Finance Bill into law, often months later. It had retrospective effect, and everyone knew it was going to have retrospective effect. Really, the only circumstance that this would not work is if the Finance Bill was defeated. With a Conservative majority of 80, and most of them delighted by the Budget, there is no chance of that.

True. but usually only the increases. The decreases usually don't kick in for 6-18 months giving them enough time to quietly cancel them again later like the planned reduction in corporation tax.

 

[WannabeOwner]

It used to be an annual ritual to rush out to fill the car up before the prices rose later that day

Can't do that, my Off Peak isn't until midnight ...