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Changes to Capital allowances for business cars – April 2018 & IASB January 2019 Changes to ‘Capatalised’ Leases

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How will the changes in Capital Allowance rates effect business’s from April 2018?

Any Business incurring expenditure from April 2018 on the acquisition or leasing (contract hire or finance lease) of cars for use in their business will be subject to the new rules.  These new rules are in place to encourage fleet operators to consider low/lower CO2 rated cars, the CO2 rate at which you can claim 100% of the rental is about to be reduced again, it used to be set at 160 g/km, now it is 130 g/km and from the 1st April 2018 it will be 115 g/km.

Below is a brief summary of the pending changes, for more detaiuls please visit the HMRC website or consult your accountant, this information is for guidance only;

For Purchases

  • 0 to 75*g/km = 100% 1st Year Allowance
  • 76 to 130**g/km = 18% Pool
  • 131+g/km = 8% Pool
  • *Excludes leasing companies
  • *50g/km from April 2018
  • ** 110g/km from April 2018

 

For Contract Hire

  • 0 to 130***g/km = 100% of rentals allowable
  • 131+g/km = 85% of rentals allowable
  • ***This includes any unrelieved VAT (VAT not reclaimed through your quarterly VAT return)
    • *** 110g/km from April 2018

Cars first available for use on or before 31/03/2018, old rules will apply for the duration of the lease (including extensions).  If the car’s CO2 is greater than 130g/km (110g/km from April 2018), unreclaimed VAT is also restricted to 85%.  Case law in this situation is Britax International GmbH v CIR [2002]; Parker LJ said in paragraph 72, “I also bear in mind that the concept of ‘expenditure’ is wide enough to include payments which may not strictly be regarded as rentals.  This includes any element of unrelieved VAT”.

IASB (International Accountancy Standards Board)

  • IFRS 16 eliminates the classification of leases as either Operating Lease or Finance Lease
  • Instead all leases are treated in a similar way to Finance Lease applying IAS 17
  • Leases are ‘capitalised’ by recognising the present value of the lease rentals and showing them either as lease assets (right-of-use assets) or together with property, plant and equipment
  • Effective January 2019 (subject to confirmation)

 

Farewell Fossil Fuel Cars…

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The Government is expected to announce sales of new diesel and petrol cars and vans will be banned from 2040 as part of efforts to tackle air pollution.

Expectedly a £255m fund is to be unveiled to help councils speed up local measures to deal with pollution from diesel vehicles, as part of £3bn spend on air quality.

The Government is set to include the 2040 ban in a court-mandated clean air strategy due to be published on Wednesday, just days before a deadline set by the High Court.

The expected move to ban petrol and diesel vans and cars follows similar plans announced in France this month and amid increasing signs that the shift to electric vehicles is accelerating.

On Tuesday, BMW announced plans for an electric Mini to be assembled at its Oxford plant while earlier this month Volvo unveiled its moves towards cleaner cars.

The Government was ordered to produce new plans to tackle illegal levels of harmful pollutant nitrogen dioxide after the courts agreed with environmental campaigners that a previous set of plans were insufficient to meet EU pollution limits.

It is thought ministers will also consult on a diesel scrappage scheme to take the dirtiest vehicles off the road.

Campaigners have demanded the final plans should include government-funded and mandated clean air zones, with charges for the most polluting vehicles to enter areas with high air pollution, as well as a diesel scrappage scheme.

Their calls for charging zones were backed up by an assessment published alongside the draft plans which suggested they were the most effective measures to tackle nitrogen dioxide, much of which comes from diesel vehicles.

But ministers have been wary of being seen to “punish” drivers of diesel cars, who they claim bought the vehicles in good faith after being encouraged to by the last Labour government on the basis they produced lower carbon emissions.

Air pollution is linked to around 40,000 premature deaths a year in the UK, and transport also makes up a significant share of greenhouse gas emissions.

A Government spokesman said: “Poor air quality is the biggest environmental risk to public health in the UK and this government is determined to take strong action in the shortest time possible.

“Our plan to deal with dirty diesels will help councils clean up emissions hotspots – often a single road – through common sense measures which do not unfairly penalise ordinary working people.

“Diesel drivers are not to blame and, to help them switch to cleaner vehicles, the Government will consult on a targeted scrappage scheme, one of several measures to support motorists affected by local plans.”

What are your thoughts?

France plan to ban Fossil Fuel Cars by 2040

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The French government has set out an ambitious goal for no more petrol or diesel cars to be sold in the country by 2040.

The target was announced by environment minister Nicolas Hulot as part of far-reaching efforts to wean the world’s sixth biggest economy off fossil fuels.

At a news conference unveiling a five-year government plan to encourage clean energy and meet France’s commitments under the Paris climate accord, Hulot said French car manufacturers have projects that “can fulfil that promise”.

His appeal came a day after Sweden’s Volvo became the first major car maker to pledge to stop making cars powered solely by the internal combustion engine.

France is unusually dependent on diesel fuel, blamed for pollution that often chokes the French capital. The Paris mayor wants to ban diesel vehicles by 2020.

Hulot’s plan would cover the whole country and also target petrol cars, but it could face resistance from manufacturers and drivers. He proposed aid for poorer families to buy cleaner vehicles.

The maker of Peugeot and Citroen cars, PSA Group, said the environment minister’s pledge fits with its goal of offering hybrid or electric versions of 80 per cent of its cars by 2023.

But even if France eventually bans sales of diesel and petrol vehicles, PSA spokeswoman Laure de Servigny said the company will continue making such cars for foreign markets.

“We are a global player,” she said. “You have to take into account the situation globally.”

What are your thoughts?

Will my cracked, chipped or damaged windscreen fail an MOT?

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My windscreen has damage on it, will it fail an MOT?

Your car’s windscreen is a vital part of your car and it does a lot more than keep the flies off your teeth, it maintains a good vision of the road ahead.

Image result for windscreen cracks

Vision

We have all been there, smeary wipers, low sun, and dead flies all reducing your visibiliy.  There are a few simple things that you can do to improve vision a lot by making sure that your windscreen is clean, inside and outside.

  • Even if you’re not a smoker a hazy film will build up on the inside of the glass, in newer cars, this is worse as the plastics in the car give off a residue.
  • If you have a scratches, abrasions or a chips on the outside this can makethe  dazzle from the sun even worse.
  • If you notice your swiper baldes are not clearing properly, then new ones are a simple and cost effective fix, many suppliers will also fit them for free of a small charge.  It is worth keeping an eye on the condition of these, over time the rubber can harden and reduce the ability to wipe the screen.
  • Use plenty of screen wash, in the summer use 20% wash to water, then in the winter, consider increasing this to 50%, this will help clear the salt off the screen and also reduce the risk of freezing.

Cracks or Chips

Depending on its size and position, a chip on your windscreen can be a distraction or even impair vision.

Damage of up to 40mm across can sometimes be repaired, depending on where in the screen it is situated.

  • If the damage is right in front of you – in the area known as the ‘A zone’ – only damage up to 10mm (slightly less than the size of a 5 pence coin) can be repaired
  • Repair involves cleaning and drying the damaged area and filling it with a clear resin with similar optical properties to glass, you will see an image below showing a repair.
  • The damage won’t completely disappear but the repaired area will be much less visible and have a smooth surface
  • If ignored, small chips can grow and become irreparable. Secondary cracks can form through the combined effect of heat, moisture, frost, dirt and vibration
  • Any dirt or moisture getting into the chip will make it more difficult to produce a visually acceptable repair so it’s important to act quickly
Image result for windscreen cracks resin repair
The MOT test

Depending on where it’s located, some windscreen damage will result in an MOT failure if not attended to.

The screen’s divided into two areas for the MOT.

  • Damage larger than 10mm across will normally result in a failure if it’s in the ‘A-zone’, a 290mm wide band centred on the steering column and bounded top and bottom by the windscreen wiper swept area
  • Damage larger than 40mm across will normally result in failure anywhere else on the windscreen
Image result for windscreen cracks
Windscreen wipers

Your car can fail the MOT if a wiper blade is insecure, missing, or in such a condition that it doesn’t clear the windscreen effectively to give you an adequate view of the road (through the windscreen) to the left and right sides of the vehicle, as well as to the front.

Wipers that judder, make a noise, leave bands of rain or unwashed margins should be replaced.

 

What are the new rules on Speeding in the UK? New fines and point system from April 2017

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The Government has decided to introduce tougher penalties for the most serious speeding offences, following statistics that indicate that the number of speeding offences has risen by 44% over the last five years. The new penalties came into force on 24 April 2017 in England and Wales (note that Scotland is excluded), and mean that offending drivers will now pay a fine based on a percentage of their weekly income, decided by the severity of the offence.

 WHAT DO THE NEW RULES MEAN FOR DRIVERS?

For fixed penalty notices, there are no changes, with a £100 fine and three penalty points. However, for those drivers summoned to court for speeding offences the penalties are changing. Previously, drivers faced fines of up to 100% of their weekly income, with a minimum fine of £100 and three penalty points. Following the changes, fines will now be split into bandings, with Band C fines costing the worst offenders up to 175% of their weekly income. Drivers may also risk being banned from the roads for up to 56 days, or alternatively could receive six points on their licence.

The maximum fines will remain the same, with offenders being fined up to £1000, or £2500 if the offence takes place on a motorway. As noted earlier, the minimum fine of £100 and three penalty points also remains unchanged.

First time offenders may avoid the increased penalties if they take a speed awareness course, however this is not available for repeat offenders or for more serious speeding offences.

 

As a result of the changes, here are some worked examples of the new fine structure. All figures are based on the UK’s average salary of £27,600 (as stated by the Office of National Statistics):

Speeding Fine changes in April 2017 – up to 150% of weekly wage.

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What happens if you get caught Speeding now?

From April 2017 the rules around speeding and the fines/penalties issued are changing.  The fines issued will be linked to your weekly wage, so the faster you go and the more you earn, the greater the penalty.

What happens if you get caught driving between 31 to 40 MPH in a 30 MPH Zone? – You are likely to get a fine of 50% of your weekly income and three points on your licence.

What happens if you get caught driving between 41 to 50 MPH in a 30 MPH Zone? – You are likely to get a fine of 100% of your weekly income and 4 to 6 points on your licence or a disqualification of between 7 and 28 days.

What happens if you get caught driving between 51 or above in a 30 MPH Zone? – You are likely to get a fine of 150% of your weekly income and 6 points on your licence or a disqualification of between 7 and 56 days.

What is a 30 MPH Zone?

This is a built up area in which the speed limit is automatically set at 30 MPH, these roads are restricted roads and are identified easily as they will have street lights.  Another definition is ‘unless an order has been made and the road is signed to the contrary, a 30 mph speed limit applies where there are three or more lamps throwing light on the carriageway and placed not more than 183 metres apart.

What happens if I get caught speeding in a leased car or van?

The majority of leased cars or vans are not registered in your own name.  If you have a car or van on a personal or business contract, that is owned by a vehicle finance, hire or leasing company then any speeding notifications will be sent to them first, then they process the paperwork and then send this on to you with a charge, normally about £35-50+VAT.

So, be a good driver, keep safe and within the speed limits and avoid the costs!

 

Land Rover & Range Rover factory order lead time update.

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How long will it take to factory order a New Land Rover or Range Rover model?

If you are looking to factory order a new Land Rover to your own specification with DSG Auto Contracts, then this is an idea of the latest factory lead times, they are typical examples of what you can expect to wait.

If you would like a business or personal contract hire, lease or purchase quote on a new Land Rover then please get in touch here.

Click here for a list of all of our latest car leasing deals on new Land Rover models.

Land Rover Model Derivative Exxpected Delivery  month  
All-New Discovery 2.0 Sd4 derivatives July 17 (subject to constraints)
3.0 Td6 derivatives August 17 (subject to constraints)
3.0 Si6 Supercharged Petrol derivatives September 17
Discovery Sport 2.0 Diesel 150PS June 17
2.0 Diesel 180PS Manual June 17
2.0 Diesel 180PS Auto July 17
RR Evoque Auto derivatives except Convertible July 17
Manual derivatives except eD4 June 17
Petrol Convertible June 17
Diesel Convertible June 17
eD4 5 Door July 17
eD4 Coupe July 17
Petrol derivatives July 17
RR Sport 3.0 V6 Diesel July 17
4.4 SDV8 Diesel June 17
V8 Supercharged AB & SVR August 17
3.0 S/C V6 Petrol August 17
2.0 SD4 HSE June 17
Hybrid derivatives Subject to separate comms
Range Rover SDV8 SWB July 17
SDV8 LWB July 17
All TDV6 derivatives August 17
Supercharged August 17
Supercharged LWB September 17
SVAutobiography & SVAutobiography Dynamic September 17
Hybrid derivatives Subject to separate communication

For more info on any of the above simply call the office on 0161 406 3936.

Cheap Audi A3 Car Leasing Special Offers & in STOCK

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Audi A3 Sportback Car Leasing Deal 

We have secured a deal on the following Audi A3 Sportback models, they are all in stock and ready to go for a quick delivery. Available on both Business and personal contract hire, we can offer these on different annual mileage rates.

To secure your car, call the office now on 0161 406 3936.

These are all based on 6+35 Payments and 8,000 Miles per annum.

A3 Sportback 1.6TDI (110) Sport – Ibis white, folding mirrors, comfort pack, hill hold assist.

Monthly payments £ 231.04 plus vat

 

A3 Sportback 1.6TDI (110) S-Line – Vegas Yellow, Heated front seats, black roof rails.

Monthly payments £ 255.46 plus vat

 

A3 Sportback 1.6TDI (110) S-Line – Cosmos Blue, Front and rear parking sensors (27005205 at the storage centre) same car available in Tango red.

Monthly payments £ 258.27 plus vat

 

A3 Sportback 2.0 TDI (150) SE Technik – Tango Red with 17” 5 arm alloys.

Monthly payments £ 237.80 plus vat

 

A3 Sportback 2.0 TDI (150) SE Technik – Tango Red with a comfort pack.

Monthly payments £ 244.26 plus vat

 

A3 Sportback 2.0 TDI (150) Sport – Nano Grey, Folding door mirrors, hill hold assist

Monthly payments £ 258.69 plus vat

 

A3 Sportback 2.0 TDI (150) Sport – Brilliant Black, Folding door mirrors, Comfort pack, hill hold assist.

Monthly payments £ 261.25 plus vat

 

A3 Sportback 2.0 TDI (150) Sport – Floret Silver, Folding door mirrors, Comfort pack, hill hold assist.

Monthly payments £ 277.31 plus vat

 

A3 Sportback 2.0 TDI (150) Sport – Tango Red, rear parking sensors, comfort pack and interior lighting pack.

Monthly payments £ 289.48 plus vat

 

A3 Sportback 2.0 TDI (150) S-Line – Floret Silver, rear parking sensors, deletion of model and engine, privacy 18” 10 spoke alloys.

Monthly payments £ 277.54 plus vat

What is a Diesel Particulate Filter (DPF)?

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Is a DPF filter right for me?

Are you looking at a new car?   Have you considering what type of fuel to choose between, Petrol, Diesel, Hybrid or Electric?

Well this might help you decide if a diesel engine with a DPF filter is suitable for your driving style.  If you would like to know more about how a DPF works then feel free to cal the office on 0161 406 3936.

DIESEL PARTICULATE FILTERS (DPF)

Diesel particulate filters are necessary to reduce the amount of harmful particles released from diesel vehicles.

Although particulate filters are very effective in dramatically reducing the amount of particulates emitted from diesel vehicles, most filters need to burn the trapped particulates off fairly regularly, known as regeneration.

This usually requires the vehicle to be driven at over 50mph for a short period of time. This fact sheet will help you decide whether vehicles using particulate filters are suitable for your drivers.

 

WHAT IS A DIESEL PARTICULATE FILTER?

Diesel particulate filters are used to reduce the exhaust emissions as required by European legislation, especially particulate matter. A particulate filter traps most of the soot that is produced during diesel combustion and would normally travel down the exhaust and into the atmosphere. These particulates can cause respiratory problems if people are exposed to high concentrations over time.

 

PARTICULATE FILTERS NEED TO “REGENERATE”

A filter can hold a certain amount of soot, but not a huge quantity, so it needs to regularly go through a process of regeneration in order to clear out the soot and allow the vehicle to operate properly. Regeneration occurs when the filter reaches a sufficiently high temperature, allowing the soot to be converted to a much smaller amount of ash. On most systems, to allow the filter to automatically regenerate, the engine should be used regularly at a sufficient speed, to ensure a high enough temperature of the exhaust gas is reached. Although it may vary from manufacturer to manufacturer, typically a vehicle must be driven at 50mph or above for at least 20 minutes in order to automatically regenerate the filter. During the regeneration phase, high temperatures in the filter may cause a slight smell, especially during the first regeneration.

 

WHAT HAPPENS IF IT DOESN’T REGENERATE?

If the vehicle is not driven in a way that automatically regenerates the particulate filter, it will build up an excessive amount of soot, which, if not resolved, will reduce the performance of the vehicle and damage the filter.

If the filter does build up too much soot, a vehicle warning light will appear to alert the driver. The problem can usually be resolved by allowing the filter to automatically regenerate until the warning light goes out – i.e. by driving the vehicle at 50mph or above for at least 20 minutes. The vehicle handbook will have specific guidance for the vehicle.  If traffic conditions and speed limits do not allow the vehicle to be driven so that the filter regenerates, it will have to be returned to a dealer for a forced regeneration to clear the filter. If the warning light is ignored and the vehicle is driven without regenerating the filter, it will cause damage to the vehicle, which will not be covered by warranty or our maintenance agreement. We are aware of businesses in the UK who have incurred costs in the region of £1,000 to £1,500 after a driver has failed to follow the correct regeneration process.

 

SELF HEATING PARTICULATE FILTERS

The majority of vehicle manufacturers now have diesel particulate filters that require the regeneration cycle to be driven, but not all. Some have systems that can heat up the particulate filter and regenerate it without the need for a higher speed drive cycle. Some inject fuel straight into the filter which burns and therefore increases the temperature in the filter, and others have heaters built into the filter. For specific details of individual models, please refer to manufacturers’ websites.

 

ALTERNATIVES FOR URBAN DRIVERS

If drivers are restricted in their ability to regenerate a diesel particulate filter through driving at higher speeds, there are other vehicles that can be chosen which do not use this technology. Diesel models with the built-in heating systems are an option, or alternatively, a petrol, petrol hybrid, electric or alternatively fuelled vehicle may be more suitable, especially in urban only driving conditions.

 

WHICH DRIVERS SHOULD ORDER THESE VEHICLES?

Diesel particulate filters significantly reduce harmful emissions and are vital for diesel vehicles meeting European tailpipe emissions, but care is needed when using this technology in predominantly urban driving conditions. Therefore check the type of particulate filter on any diesel car with an urban drive-cycle and make sure it’s suitable, otherwise consider a different fuel type or vehicle technology.

New London Air Quality Measure Launches in October

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London Mayor Sadiq Khan has confirmed that the £10 toxic T-Charge, the toughest emission standard of any world city hitting most vehicles over 11 years old, will start in central London on October 23rd this year.

To forewarn motorists, the Mayor has launched a free online vehicle checker on the Transport for London website so that drivers can see whether their vehicle – typically both petrol and diesel more than 11 years old – will be affected by the T-Charge.

Up to 10,000 of the oldest, most polluting vehicles are expected every weekday to be potentially liable for the new emissions levy, which will apply to motorists who own vehicles that do not meet Euro 4 standards – generally every kind of vehicle, diesel and petrol, registered before 2006.

Exemptions include fire engines and ambulances and breakdown vehicles exempted from the Congestion Charge, as well as Blue Badge holders registered for the 100% Congestion Charge discount who will be automatically registered and vehicles used by disabled people that have a ‘disabled’ taxation class, such as Dial-a-Ride and modified vehicles.

The T-charge (also known as the Emissions Surcharge) will operate on top of, and during the same operating times, as the Congestion Charge (Monday to Friday 7am-6pm), so it will cost £21.50 to drive a pre-Euro 4 vehicle in the zone.

Air pollution in London is a public health crisis and the Mayor has been forced to take hard-hitting action to tackle it head on. Currently over 9,000 Londoners die prematurely each year as a result of long-term exposure to air pollution – while 438 schools in the capital are in areas exceeding legal air quality levels.

The Mayor of London, Sadiq Khan, said: “It’s staggering that we live in a city where the air is so toxic that many of our children are growing up with lung problems. If we don’t make drastic changes now we won’t be protecting the health of our families in the future.

“That is why today, on the 14th anniversary of the start of the congestion charge, I’ve confirmed we are pressing ahead with the toughest emission standard of any major city, coming to our streets from October 23rd .

“Londoners overwhelmingly support my plans to introduce this £10 charge because they feel when it comes to battling pollution the time for action is now.

“The T-Charge is a vital step in tackling the dirtiest diesels before I introduce the world’s first Ultra Low Emission Zone as early as 2019.
“I will continue to do everything in my power to help protect the health of Londoners and clean our filthy air. But now is the time for Government to show real leadership and join me by introducing a diesel scrappage fund and bring in the new Clean Air Act we desperately need.”

Leon Daniels, TfL’s Managing Director of Surface Transport, said: “London’s air quality crisis is one of the biggest challenges we face and we are working alongside the Mayor to address it.

“The T-Charge is a crucial part of this work and will discourage drivers of the oldest, most polluting vehicles from driving in central London. To help drivers we have created an online compliance checker, which can be found on the TfL website, that enables people to easily establish whether they will be affected by the charge.”

Like the Congestion Charge, the T-Charge will use a camera-based system for enforcement, monitoring all vehicles, and is just one of the wide range of measures the Mayor is introducing to improve air quality.

The Mayor has doubled funding spent on tackling air quality to £875million (over the next five years) and will be consulting on introducing the start the central London ULEZ in 2019, expanding the ULEZ up to the North/South Circular roads and making it London-wide for heavy vehicles as early as 2019.
He is also spending more than £300m transforming London’s bus fleet by phasing out pure double-deck diesel buses and has committed to purchase only hybrid or zero-emission double-decker buses from 2018.