The Government has published the draft Finance Bill, due to be debated and come into force during 2017.
Of particular interest to the BVRLA's leasing members are the further details regarding salary sacrifice arrangements. As announced by the Chancellor last month, the tax and employer National Insurance advantages of salary sacrifice schemes will be removed from April 2017, though cars which emit less than 75g/km CO2 will be exempt from these changes until 6 April 2021. Cars where the salary sacrifice contracts begin, end, are varied or auto-renewed prior to 6 April 2017 will also continue to remain exempt until 2021.
The reform will apply to arrangements where the employee forgoes cash in exchange for a BiK, including salary sacrifice arrangements, flexible benefit packages with a cash alternative and BiKs where there is an option to take a cash allowance instead. This includes vehicles provided under a cash-alternative basis, as well as purely salary sacrifice arrangements.