Budget highlights for van users at a glance

9th April 2014

The Chancellor made a number of announcements affecting van drivers and fleets in the Budget last month.

 

  • Fuel – September’s planned 1.6p per litre increase in fuel duty has been cancelled and there will be no further rise before the 2015 election.  Legislation will be introduced in the Finance Bill 2015 to apply a reduced rate of duty (9.32p a litre) to methanol composed of 95% pure methanol and 5% water, from 1 April 2015.  The differential between the main rate and methanol will be maintained until March 2024.

 

  • Road tax – Vehicle Excise Duty has increased in line with inflation.  The 2014/15 rates for vans registered on or after 1 March 2001 include £140 for early Euro 4 and Euro 5 compliant vans and £225 for all other vans.  VED rates for Euro IV and V light goods vehicles have been frozen.  However, as announced in the 2013 Budget, the Government will now reduce and re-structure VED rates for HGVs within the HGV Road User Levy scheme.

 

  • Van benefit-in-kind tax charge – this has increased from £3,000 in 2013/14 to £3,090; from 6 April 2015 it will increase by RPI.  However, the benefit charge support for zero emission vans will be extended to 5 April 2020, on a tapered basis.  From 2015/16 the charge will be 20% of the rate for conventionally-fuelled vans, followed by 40% in 2016/17, 60% in 2017/18, 80% in 2018/19 and 90% in 2019/20, with the rates equalised in 2020/21.

 

  • Van fuel benefit charge 2014/15 – the van fuel benefit charge multiplier has increased from £564 to £581.  From 6 April 2015 the multiplier will once again increase by RPI.

 

  • Company van tax – Benefit-in-Kind taxation for the personal use of a company van has increased to £3,090, and those paying income tax at 20% will be charged £618 a year – plus an additional £116 a year if free fuel is provided.

 

  • Capital Allowances – the Government is extending the enhanced capital allowances for zero emission goods vehicles to March/April 2018.  However, it will be limited to businesses that don’t claim the Plug-in Van Grant.

 

The Chancellor also announced a £200 million “potholes challenge fund”.  Billed as “emergency funding”, local authorities will be able to bid for the cash to repair up to 3.2 million potholes following the recent severe weather.

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