Autumn Budget Key Points For Car Dealers and Garages
22nd November 2017
Business Rates index switch will be brought in two years early and revaluations will reduce from every five years to every three years from 2022.
National Minimum Wage for apprentices and young people will increase from April next year.
Personal tax-free allowance to increase again for your employees from April 2018.
Vehicle Excise Duty supplement on diesel cars registered after April 1 2018, so their first year rate is effectively calculated at the band above.
Cars, vans and motorcycles registered before April next year will see an increase in the VED rates in line with the Retail Price Index, from April 2018.
Company cars: tax diesel supplement will rise from 3% to 4% from 6 April 2018 and fuel benefit charge is to increase in line with the Retail Price Index.
Fuel duty is frozen for the eighth year in a row.
The Government is to invest in supporting electric vehicles, and wants to see self-driving cars tested and on UK roads by 2021.
Business rates will switch from being increased by the Retail Price Index to the current main measure of inflation, the Consumer Price Index, two years earlier than initially planned. Car Dealers and Garages could well find that their business rates reduce with the change in April 2018, as the Retail Index measurement tends to be higher.
Also revaluations of business rates will reduce to every three years instead of five years, from the next revaluation due in 2022.
National Minimum Wage Increase
For dealers employing young people or apprentices, the National Minimum Wage is also increasing from April next year. Apprentices will see a 5.7% rise from £3.50 to £3.70 per hour and the new minimum hourly rates per age group are:
21 to 24 years: £7.38 per hour (4.7% increase from £7.05)
18 to 20 years: £5.90 per hour (5.4% increase from £5.60)
16 to 17 years: £4.20 per hour (3.7% increase from £4.05)
The National Living Wage for those over 25 will also increase by 4.4% from £7.50 to £7.83 from April 2018.
Personal Allowance Increases
From April 2018 the tax-free Personal Allowance will increase again by £350 to £11,850, meaning your employees will be able to keep more of what they earn. According to the budget report, this means that a typical taxpayer will pay £1,075 less tax in the tax year 2018-19 than they did in 2010-11. The higher rate threshold also increases to £46,350, in line with inflation.
Vehicle Excise Duty (VED)
To help pay for a £220 million provision from the government for a new Clean Air Fund, a Vehicle Excise Duty (VED) supplement will apply to new diesel cars first registered from 1 April 2018, so that their first year rate will be calculated as if they were in the VED band above. This will not apply to next-generation clean diesels – those which are certified as meeting emissions limits in real driving conditions.
For cars, vans and motorcycles registered before April 2017 and the first year rates for cars registered after April 2017, from April 1 next year VED will increase in line with the Retail Price Index. Heavy Goods Vehicle (HGV) VED will be frozen.
The existing Company Car Tax diesel supplement will increase from 3% to 4%, with effect from 6 April 2018. This will only to diesel cars which do not meet the Real Driving Emissions standards. The Fuel Benefit Charge and the Van Benefit Charge will also both increase by RPI at the same time.
In 2018, fuel duty will remain frozen for the eighth year in a row, saving drivers £160 a year on average.
Ultra Low Emission Vehicles
To support the transition to zero emission vehicles, the government will invest £200 million in a Charging Investment Infrastructure Fund to be matched by private investment and commit to having 25% of cars in central government department fleets electric by 2022. To help consumers with the cost of purchasing a new electric vehicle, the government will also provide £100 million to guarantee continuation of the Plug-In Car Grant up to 2020.
The government wants to see fully self-driving cars on UK roads by 2021 and intend to set out regulations on how driverless cars can be tested without a human safety operator. A new innovation prize will be launched by The National Infrastructure Commission (NIC) to determine how future roadbuilding should adapt to support self-driving cars.