Contract Hire received a boost as major changes to capital allowances announced by Chancellor Alistair Darling came in to force on the 1st April 09, with cars emitting pollutants less than 160g/km suffering no rental disallowance for the first time allowing companies to offset the full cost of their contract hire rentals against taxable profits.
This new move has increased the attractiveness of cars that emit less than 160g/km of carbon dioxide for many companies and reduce the attractiveness of cars that emit more than this standard – just as the Chancellor intended!
Before April 1st when cars over £12,000 were leased , a percentage of their rental was disallowed against profits up to a maximum of 25% which was always been a bone of contention with the contract hire and leasing organisation within the UK.
This changed on the 1st April 09 as leased cars emitting more than 160g/km will have 15% of the rentals disallowed against company profits BUT those emitting less than 160g/km will suffer no disallowance, thus removing the rental disallowance that used to exist on cars costing more than £12,000, and making these cars more attractive to companies for tax and other financial reasons.
Cars that emit less than 160g/km are not just the typical green cars one may expect. For more details regarding the tax changes or vehicle quotes please e-mail nick@yvf.co.uk or call 0114 236 1818
Standard Text Size
Increase Text Size
