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The Autumn Budget presented another mixed bag for BVRLA members and their customers. While greater certainty over future Benefit-in-Kind (BiK) tax rates, plus progress on charging costs were welcomed, concerns remain over changes to capital allowances and the introduction of electric Vehicle Excise Duty (eVED).
The BVRLA welcomed the additional year of clarity on company car tax rates – the BEV rate is confirmed at 10% for 2030-31 – recognising the importance of a predictable tax framework in supporting investment in electric vehicles.
There were also some welcome progress on the implementation of eVED, although the association maintains that it is the wrong tax at the wrong time. For eVED, the Budget confirmed:
- Automated refunds by 2030: a positive response to our asks, including refunds when cars are sold or mileage overestimated. How cumulative credit built up during a lease or rental ownership will be refunded remains unresolved; we are pushing for maximum fleet flexibility.
- eVED Connect: an opt-in system using vehicle telematics to reduce manual mileage reporting has been announced but won’t be ready at launch in April 2028. There is no implementation timetable yet; we will engage through 2027.
- Mileage estimation tool: a consumer-facing GOV.UK tool will be available to help individuals estimate mileage; it is not a fleet reporting system.
Capital allowances: Members asked to share impact
The reduction in capital allowances is another concern for the sector. These allowances provide tax relief for the depreciation of certain business assets, reducing the amount of corporation tax payable. Following changes announced across the last two Budgets, the main writing down allowance will fall to 12% from April 2027 (down from 18% just two years ago), meaning businesses will receive tax relief more slowly.
The BVRLA is seeking to understand the financial impact of these changes on members and is asking businesses to complete a short capital allowances survey by 30 November. Questions can be directed to Zohra Chagani.
Corrections to Budget tax information
The BVRLA has also raised several errors in the Government's Budget 2026 Overview of Tax Legislation and Rates (OOTLAR) with HM Treasury. These have either been corrected or are being updated:
- Company car BiK rates: Rates announced last year were carried forward incorrectly in the published tables. The previously announced rates remain unchanged and the OOTLAR has now been updated.
- Fuel benefit and van charges for 2027/28: The car fuel benefit multiplier and van benefit charge were incorrectly swapped in the original publication. The correct figures, effective from 6 April 2027, are £30,200 for the car fuel benefit multiplier, £825 for the van fuel benefit charge and £4,310 for the van benefit charge.
- Vehicle Excise Duty (VED): The expensive car supplement will increase from £440 to £460 in 2027/28, in line with inflation. This was incorrectly stated in the OOTLAR and is being updated.
Budget webinar available to watch
Members can also watch the BVRLA's post-Budget webinar, recorded 24 hours after the Chancellor's announcements. Thomas McLennan and Zohra Chagani provide an initial assessment of the measures most relevant to vehicle rental, leasing and fleet operators, and their potential implications for businesses.
The discussion is also available in podcast format. Members with further questions can contact the BVRLA policy team.
