Is your company car and cash alternative strategy fit for the 21st century?

The climate is changing for company car fleets. Budget 2008 heralded changes to the way that company car schemes are taxed. There’s increasing focus on the impact that companies make on the environment and there are new rules on how culpable employers are in corporate manslaughter cases. So it’s never been more important to readdress company car fleet policies and procedures to ensure that your business has a cost effective, compliant and environmentally responsible car fleet fit for the 21^st century.

What are the issues?

Legal imperative

The Corporate Manslaughter and Corporate Homicide Act took effect in April 2008. It introduces a new offence, across the UK, for prosecuting companies and other organisations where there has been a gross failing, throughout the organisation, in the management of health and safety with fatal consequences. An estimated 2 million privately owned cars are used for work purposes and over 1/3 of UK road accidents involve business drivers. This makes health and safety management of car fleets critical.

New economic landscape

Changes were made in Budget 2008 to capital allowances and leasing rules relating to business cars. Employer-provided cars continue to be taxed on employees according to their list prices and a CO2 emissions-based percentage (10% or 13% for most diesels from 2008/09). The Chancellor also announced further reduced thresholds for 2010/11.

Employees and employers concerned about the corporate social responsibility agenda

PwC research* has uncovered that 86.9% of graduates polled indicated that they would deliberately seek to work for employers whose corporate responsibility behaviour reflects their own values, offering a clear signal that the corporate social responsibility (CSR) agenda is gaining in importance. Increasing numbers of employers are recognising the link between CSR and recruitment and retention and there’s a clear opportunity to engage employees by offering greener solutions for company travel.

More environmental options

There are now more environmentally friendly car options to consider: CO2 emission reduced cars, electric cars and E85 fuel (85% bio-ethanol and 15% petrol mix).

What can I do?

In light of these changes, are you considering how you manage your company car fleet? Do you have a grey fleet of cars and are worried about how this impacts on your business?

Watch Matthew Hunnybun and Gary Hull from PwC’s Employment Solutions team talk about the issues and uncover the solutions in this recorded webcast.

*Source: PricewaterhouseCoopers report Managing tomorrow’s people: the future of work to 2020