FDs unaware of lower CO2 tax savings
13 June 2011
Finance directors are unaware of the savings they can make through reducing employees' National Insurance Contributions by incorporating greener vehicles into their companies' fleets.
According to a survey of plus-500 vehicle fleets conducted by fleet management firm ALD Automotive in conjunction with YouGov, 35% of FDs are in the dark about the impact of CO2 emissions on NICs.
In April the NIC rate increased from 12.8 to 13.8%. By offering a choice of lower emitting vehicles and making staff aware of the savings available through leasing greener vehicles, ALD says businesses can generate substantial savings.
However, it also found that only 15% of FDs felt they had a detailed understanding of the costs associated with running their company car fleets.
By switching to more eco-friendly models the Class 1A NIC employers pay is significantly cut. ALD says changing from petrol to diesel on some models could save £355. On a fleet of 500 vehicles the potential cost saving is then £167,500 a year. As a knock-on affect, employees would also benefit from lower BIK.
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