B15a

ŠKODA Communication Guideline, Brand Elements, preliminary version 09/2016B12

B 1.5 Landscape Brand Mark

The landscape version of the ŠKODA brand mark is defined

as exception and may only be used when such a format

is required due to layout reasons, e.g. signage on buildings,

perimeter advertising or merchandising items.GUIDE TO COMPANY CAR TAX 2018/19 March 2018

Home March 2018 Budget update

Vehicle Excise Duty (VED)

Company Car BIK Tax

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MARCH 2018 BUDGET STATEMENT: MAIN POINTS

› Company car BIK tax bands The diesel Benefit-in-Kind tax charge rises from 3% to 4% for cars that do not meet the Real Driving Emissions Step 2 (RDE2) standard, with the increased charge applicable from April 6th 2018.

› Annual vehicle excise duty (VED) Increased first year rates of VED for new diesel cars that do not meet the RDE2 standard apply from April 1st 2018. An RPI-linked rise in VED for cars already registered at March 31st 2017 also applies from the same date.

› The fuel benefit charge (FBC) The Government fuel benefit charge (FBC) used to calculate the tax due on employer-provided fuel for private use rises to £23,400 on April 6th 2018. For vans, the benefit charge for fuel provided for private use rises from £610 to £633.

› Fuel duty Road fuel duty rates remain unchanged from 2017/18 levels in 2018/19.

› Capital allowances and lease rental restriction From April 1st 2018, the CO2 emissions threshold for main rate capital allowances for new car purchases falls from 130g/km to 110g/km, with the 100% first-year allowance threshold also reducing from 75g/km to 50g/km, applicable until March 31st 2021.

› ULEV taxation A new £400m charging infrastructure fund was announced, together with investment of an extra £100m in the Plug-in-Car Grant (PiCG) and £40m in extra funding for R&D into charging technologies. The Chancellor also stated that, from April 1st 2018, those charging electric vehicles at work will not face a BIK tax charge.

Main pointsThe Budget Statement on March 13th confirmed the introduction of raised BIK tax liabilities for diesel drivers and an increase in Vehicle Excise Duty, with a new ‘showroom tax’ for diesels from April 1st 2018 that will add up to a £520 premium at first registration over petrol counterparts.

Drivers of diesel company cars will see a rise in the 3% Benefit-in-Kind diesel tax charge to 4%, applicable from April 6th 2018, although the measures do not apply to diesel models that comply with the Real Driving Emissions Step 2 (RDE2) standard.

This Guide updates the key points from the March 2018 Budget Statement.

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VEHICLE EXCISE DUTY (VED)

New car Vehicle Excise Duty (VED) rates are shown above right. From April 1st 2018, diesel cars that do not meet the Real Driving Emissions Step 2 (RDE2) standard are liable for increased first-year (or ‘showroom tax’) rates.

For cars already registered by March 31st 2018, VED rates remain in the previous 13-band structure, and are subject to a RPI-based increase from April 1st 2018 as shown in the table (right).

› First-year rate. Applicable to all new cars, with increased rates for diesels from April 1st 2018

› Standard rate – year 2 on. £140. Cars with CO2 emissions of 1g/km or over with a list price of £40,000 or less

› Additional rate – year 2 on. £450. Cars with CO2 emissions of 1g/km or over with a list price over £40,0002

VED rates: cars already registered by March 31st 2018VED CO2emissions 2018/19band (g/km) Standardrate (comparedwith2017/18)

A Upto100 £0(+£0)B 101-110 £20(+£0)C 111-120 £30(+£0)D 121-130 £120(+£5)E 131-140 £140(+£5)F 141-150 £155(+£5)G 151-165 £195(+£5)H 166-175 £230(+£10)I 176-185 £250(+£10)J 186-200 £290(+£10)K* 201-225 £315(+£10)L 226-255 £540(+£20)M Over255 £555(+£20)

*Includescarsemittingover225g/kmregisteredbeforeMarch23rd2006.NewratesapplyfromApril1st2018

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VED rates: new cars from April 1st 20182018/19

CO2 First year rate First year rate Standard rate Standard rateemissions (compared (for diesel vehicles (Yr2 on for (Yr2 on for(g/km) with compared with cars with list price cars with list price 2017/18) 2017/18)1 of £40,000 or less) of over £40,000)2

0 £0 (+£0) £0 (+£0) £0 £3101-50 £10 (+£0) £25 (+£15) £140 £45051-75 £25 (+£0) £105 (+£80) £140 £45076-90 £105 (+£5) £125 (+£25) £140 £45091-100 £125 (+£5) £145 (+£25) £140 £450101-110 £145 (+£5) £165 (+£25) £140 £450111-130 £165 (+£5) £205 (+£45) £140 £450131-150 £205 (+£5) £515 (+£315) £140 £450151-170 £515 (+£15) £830 (+£330) £140 £450171-190 £830 (+£30) £1,240 (+£440) £140 £450191-225 £1,240 (+£40) £1,760 (+£560) £140 £450226-255 £1,760 (+£60) £2,070 (+£370) £140 £450Over 255 £2,070 (+£70) £2,070 (+£70) £140 £450

1 Applies to diesel vehicles that do not meet the real driving emissions step 2 (RDE2) standard. 2 All cars with a list price over £40,000 are liable for a £310 supplement for five years following the first year rate, after which the rate reverts to the standard £140 a year. For cars with zero emissions the rate reverts to £0 after five years. Alternative fuel vehicles receive a £10 annual reduction. New rates apply from April 1st 2018

COMPANY CAR BIK TAXThe BIK tax charge on diesel cars rises from 3% to 4% from April 6th 2018. The charge does not apply to diesels which meet Real Driving Emissions Step 2 (RDE2) standards, although currently there are no such vehicles available (see table, right).

Calculating BIK taxTo calculate BIK tax you need to know the car’s P11D value*, CO2 emissions, and whether or not it is a diesel. CO2 data for all ŠKODA models is available at www.skoda.co.uk or the Vehicle Certification Agency at www.dft.gov.uk/vca.

Example: on 1st April 2018, a new ŠKODA Octavia Hatch SE Technology 1.6 TDI 115PS has a P11D value of £20,895 and CO2 emissions of 106g/km. How much BIK tax will I pay in 2018/19?

CO2 emissions of 106g/km give the Octavia Hatch SE Technology 1.6 TDI 115PS a tax percentage of 26% in 2018/19, so the taxable value is £20,895 x 26% = £5,433. For a 20% tax payer, the tax is £5,433 x 20% = £1,087 a year, or £91/mth. For a 40% tax payer, it is £5,433 x 40% = £2,173 or £181/mth.

*The P11D value is the price of the car for tax purposes. It comprises the list price of the car plus any options over £100, VAT and delivery but excludes the Government First Registration Fee (GFRF) and Vehicle Excise Duty

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Taxable percentages of P11D value 2018/19 to 2019/20 2020/21CO2 BIK % Capital BIK % CO2 Zero BIK %emissions 2018/19 allowance % 2019/20 emissions emissions 2020/21(g/km) 2018/19 (g/km) range2

0-50 13 (17) 100 16 (20) 0 All 2 (6) 1-50 Over 130 2 (6) 1-50 70-129 5 (9) 1-50 40-69 8 (12) 1-50 30-39 12 (16) 1-50 Up to 30 14 (18)51-75 16 (20) 18 19 (23) 51-54 - 15 (19)76-94 19 (23) 18 22 (26) 55-59 - 16 (20)95-99 20 (24) 18 23 (27) 60-64 - 17 (21)100-104 21 (25) 18 24 (28) 65-69 - 18 (22)105-109 22 (26) 18 25 (29) 70-74 - 19 (23)110-114 23 (27) 18/81 26 (30) 75-79 - 20 (24)115-119 24 (28) 8 27 (31) 80-84 - 21 (25)120-124 25 (29) 8 28 (32) 85-89 - 22 (26)125-129 26 (30) 8 29 (33) 90-94 - 23 (27)130-134 27 (31) 8 30 (34) 95-99 - 24 (28)135-139 28 (32) 8 31 (35) 100-104 - 25 (29)140-144 29 (33) 8 32 (36) 105-109 - 26 (30)145-149 30 (34) 8 33 (37) 110-114 - 27 (31)150-154 31 (35) 8 34 (37) 115-119 - 28 (32)155-159 32 (36) 8 35 (37) 120-124 - 29 (33)160-164 33 (37) 8 36 (37) 125-129 - 30 (34)165-169 34 (37) 8 37 (37) 130-134 - 31 (35)170-174 35 (37) 8 37 (37) 135-139 - 32 (36)175-179 36 (37) 8 37 (37) 140-144 - 33 (37)180-184 37 (37) 8 37 (37) 145-149 - 34 (37)185-189 37 (37) 8 37 (37) 150-154 - 35 (37)190-194 37 (37) 8 37 (37) 155-159 - 36 (37)195+ 37 (37) 8 37 (37) 160+ - 37 (37)

Figures in brackets apply to diesels. Diesel hybrids and diesel cars that meet the Real Driving Emissions Step 2 (RDE2) standard are exempt from the diesel tax charge. 1 18% capital allowance applies to vehicles with CO2 emissions of 110g/km or less and 8% applies to vehicles with CO2 emissions of 111g/km or more. 2 Measured in miles. Percentages apply from April 6th in each year

CAPITAL ALLOWANCES AND LEASE RENTAL RESTRICTIONCapital allowances The capital cost of any new car bought outright by a company can be written down against corporation tax based on the car’s emissions of CO2.

From April 1st 2018, the CO2 emissions threshold for main rate capital allowances falls from 130g/km to 110g/km. The 100% first-year allowance threshold reduces from 75g/km to 50g/km from the same date, with the allowance applicable until 31st March 2021.

For new company cars with CO2 emissions of 51-110g/km, the annual write-down allowance is 18% a year. For cars with CO2 emissions of 111g/km or more the allowance is 8% a year.

A 100% first-year allowance applies until 31st March 2021 for cars with CO2 emissions of 50g/km or less.

Leasing companies are exempt from claiming the first year allowance.

Lease rental restrictionThe amounts payable on lease rentals are an allowable expense for businesses that can be written down against tax.

From April 1st 2018, the CO2 emissions thresholds reduce as for capital allowances from 130g/km to 110g/km

So, in 2018/19 cars with CO2 emissions of 110g/km or less are eligible for 100% of their lease payments to be written down

against tax. For cars with CO2 emissions of 111g/km or more, only 85% can be written down.

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FUEL COST REIMBURSEMENTEmployer-provided ‘free’ fuel If your employer pays for all the fuel you use in your company car – for both business and private mileage – the private element is taxable under the CO2 emissions-based rules.

The amount of tax due on the fuel is calculated using the Government fuel benefit charge (FBC) figure, set at £23,400 from April 6th 2018.

To calculate the tax due, you need to know the car’s combined fuel consumption and BIK tax percentage, the price of fuel used and the driver’s marginal tax rate – 20% or 40% in 2018/19.

Example: a new ŠKODA Kodiaq SE Technology 2.0 TDI 150PS 4x4 DSG (7 seats) has combined fuel consumption of 49.6mpg and CO2 emissions of 149g/km. How much tax will I pay for ‘free’ private fuel? › The BIK tax percentage for this model

in 2018/19 is 34%, so the taxable value is £23,400 x 34% = £7,956. For a 20% tax payer, the annual tax payable is £7,956 x 20% = £1,591. For a 40% tax payer, it is £7,956 x 40% = £3,182.

› Assuming the national average price for diesel of £5.64/gallon (£1.24/litre) (March 2018)*, £1,591 will buy around

282 gallons for a 20% tax payer. For a 40% tax payer £3,182 will buy around 564 gallons. Multiplying the Kodiaq’s 49.6mpg combined consumption by 282 gallons gives 13,987 – the private mileage you will need to cover to make the ‘free’ fuel benefit worthwhile. For a 40% tax payer the figure is 27,974 miles.

› If your private mileage is less than the calculated figure, paying for the fuel yourself will cost less than the tax. If your private mileage is greater than the calculated figure, you are better off paying the tax.

*Please note, the price of fuel is subject to change

Business mileage in a private car: reimbursement ratesIf you drive your own car on business, you can claim Tax and National Insurance-exempt reimbursement using HMRC Mileage Allowance Payments (MAPs).

HMRC MAP rates 2018/19 Up to Over 10,000 miles 10,000 miles

All cars 45p 25p

If your employer reimburses you at a lower rate than the MAPs, you can claim tax relief on the difference. Reimbursements made at a higher level will incur tax.

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CLASS 1A NATIONAL INSURANCE CONTRIBUTIONS (NIC)

Annual Class 1A NIC is payable by employers on the company car and car fuel benefits at the rate of 13.8% of taxable value.

To calculate the annual NIC due on a company car in 2018/19, the car’s P11D value is multiplied by its BIK tax percentage. The result is then multiplied by 13.8% to give the annual NIC due.

Example: we are looking to add the new ŠKODA Karoq SE Technology 1.5 TSI 150PS to our choice list. What is the Class 1A NIC liability for this model in 2018/19?

A new ŠKODA Karoq SE Technology 1.5 TSI 150PS has a P11D value of £22,010 and CO2 emissions of 123g/km as at April 1st 2018, giving it a BIK tax percentage of 25% in 2018/19. Multiplying 25% by £22,010 gives a taxable value of £5,503, which, when multiplied by 13.8%, derives annual Class 1A NIC payable of £759 in 2018/19.

Calculation of employers’ Class 1A NIC

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GOVERNMENT GRANTS FOR ULTRA-LOW EMISSION VEHICLES

Ultra-low emission vehicles (ULEVs) – defined as electric or part-electric cars that emit 75g/km of CO2 or less – are eligible for a Government plug-in car grant, or PiCG.

The November 2017 Budget announced investment of an extra £100m in the PiCG, a new £400m charging infrastructure fund and £40m to assist with charging infrastructure R&D. It also confirmed that charging an electric vehicle at work will not give rise to a benefit-in-kind charge for the driver.

The grants are administered by the Office for Low Emission Vehicles (OLEV), with the available amounts varying according to the car’s emissions of CO2 and its zero-emissions range.

All ULEVs are categorised according to their emissions of CO2 and their zero-emission range, with the maximum PiCG grant available per car set at £4,500.

The categories are summarised below:

› Category 1: cars with CO2 emissions of less than 50g/km and a zero-emissions range of over 70 miles receive a grant which pays for 35% of the purchase price, up to a maximum of £4,500.

› Category 2: cars with CO2 emissions of less than 50g/km and a zero-emissions range of between 10 and 69 miles receive a grant which pays for 35% of the purchase price, up to a maximum of £2,500.

› Category 3: cars with CO2 emissions of 50-75g/km and a zero-emissions range of at least 20 miles receive a grant which pays for 35% of the purchase price, up to a maximum of £2,500.

Cars with a list price of £60,000 or more are not eligible for the grant, except for those in Category 1.

For more information on the PiCG, including an on-line vehicle selector, visit the OLEV website at www.gov.uk/government/organisations/office-for-low-emission-vehicles

The explanations and data set out in this guide are for general information only, and though given in good faith, are made without any warranty as to their accuracy and do not take into account changes after the date

of publication. Please refer to your legal or tax adviser for individual professional advice. Images are for illustration purposes only and may not be to the exact specification described. All information correct at date of

publication, March 13th 2018. All prices shown are applicable to vehicles in standard trim, apply to cars first registered on or after April 1st 2018 and include VAT at 20%. All models shown are equipped with standard-fit

transmission unless otherwise stated. All ŠKODA diesel engines are fitted with a Diesel Particulate Filter (DPF) as standard. Fuel consumption and CO2 figures quoted for ŠKODA models are obtained under standardised

EU test conditions (Directive 93/116/EEC) and are for comparative purposes for vehicles fitted with standard wheel and tyre combinations. This allows a direct comparison between different manufacturer models but may

not represent the actual fuel consumption achieved in ‘real world’ driving conditions. CO2 emissions can change if a different-sized alloy wheel is ordered with the vehicle. This may also lead to a change to the VED amount

payable. More information on CO2 emissions is available at www.skoda.co.uk/fuel-consumption-statement and at www.dft.gov.uk/vca.

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