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BUDGET '09: Chancellor to make extra £85m by removing £80,000 BIK cap
Date: 28 April 2009
Luxury company cars will generate an extra £85 million for Government coffers in the 2011/12 tax year because of the removal of the £80,000 cap on benefit-in-kind taxation announced in last week's Budget.
Budget 2009 revealed the £80,000 cap on the list price of company cars will be abolished, and the full list price of all company cars will be used to calculate the level of benefit that is taxable.
The figure is an estimate by HM Treasury using HMRC data.
An HMRC spokesman said: "The figure quoted in the Budget document is only a projected figure for 2011/12.
"HMRC does not hold information on the precise number of company cars, with a chargeable benefit amount of £80,000 or more, that are given to employees as a benefit-in-kind each year.
"However, around 1700 cars with a list price of £80,000 or more were sold to business in total in 2007. It is assumed that a large proportion of these cars are used as company cars."
