inspire: financial management
Corporation/Employers Tax Rates & Allowances 2006/07
Corporation Tax
*Minimum rate of 19% applies when profits are distributed to non-company shareholders.
The profits limits are reduced for accounting periods of less than 12 months and for a company with associated companies.
Capital Allowances
VAT on private fuel - scale charge due per quarter per car for accounting periods beginning on or after 1 May 2006.
| Petrol Charge | VAT | Diesel Charge | VAT | |
| Up to 1400cc | £273 | £40.66 | £260 | £38.72 |
| 1401 - 2000cc | £346 | £51.53 | £260 | £38.72 |
| Over 2000cc | £508 | £75.66 | £331 | £49.30 |
Car and Fuel Benefits
Company cars
- For diesel cars add a 3% supplement, but maximum still 35%. This is waived for Euro IV diesels. For 2006/07, no waiver for diesels registered on/after 1 January 2006.
- Discounts apply to certain environmentally friendly cars.
- For cars registered before 01.01.98 charge is based on engine size.
- The list price includes accessories and is subject to an upper limit of £80,000.
- List price is reduced for capital contributions made by the employee up to £5,000.
Fuel benefits
- The fuel benefit charge is proportionately reduced if provision of private fuel ceases part way through the year.
- The fuel benefit is reduced to nil only if the employee pays for all private fuel.
Van benefit per vehicle - 2006/07 and 2005/06
Vehicles under 4 years old - £500
Vehicles at least 4 years old - £350
Notes
1. The charge only applies if there is unrestricted private use of the van.
2. Van benefits include fuel for private use.
Mileage Allowances
2006/07 Rate per Mile
| Cars and Vans | Up to 10,000 Miles - 40p |
| Over 10,000 Miles - 25p | |
| Bicycles | 20p |
| Motorcycles | 24p |
These rates represent the maximum tax-free mileage allowances for employees using their own vehicles for business. Any excess is taxable. If the employee receives less than the statutory rate, tax relief can be claimed on the difference.
National Insurance
| Class 1 (employed) contracted in | 2006/07 | |
| Weekly earnings | Employer | Employee |
| Up to £97 | *Nil | *Nil |
| £97.01 — £645 | 12.8% | 11% |
| Over £645 | 12.8% | £60.28 + 1% |
| Class 1A (employers) | 12.8% on employee taxable benefits |
| Class 1B (employers) | 12.8% on PAYE Settlement Agreements flat rate per week £2.10 |
| Class 2 (self-employed) | flat rate per week £2.10 |
| Small earnings exemption p.a. £4465 | |
| Class 3 (voluntary) | flat rate per week £7.55 |
| Class 4 (self-employed) | 8% on profits between £5035 and £33540 plus 1% on profits over £33540 |
