The number of employees paying company car tax has fallen 10% year-on-year, according to new data published by HMRC. 2020/21 saw 720,000 company car drivers; 80,000 fewer than reported the previous year, despite a 0% BIK rate for electric vehicles being introduced. The total taxable value of company car benefits was £4.62 billion in 2020/21, down from £5.43bn.
The recent decline is likely to have been influenced by rising fuel prices. Fuel prices have risen 58.5% between August 2020 and August 2022 causing employers and employees to take a more cautious approach to reduce their mileage and save some money. In the aftermath of COVID-19, there has been a major shift to hybrid working and working from home, meaning that many people no longer commute to work or travel to meetings as this is possible online.
The Department for Transport reported that UK traffic levels were 5.6% lower than before COVID-19, except for vans and HGV’s. Not only are there more vans on the road now than before the pandemic, but growth has seen a sharp spike, evidence of changing consumer habits.
Read More: The rise of the van
How does this affect your fleet?
As a fleet manager, are you confident that your grey fleet drivers have the correct documentation and licensing? Total Motion data suggested that 6.7% of grey fleet cars did not have the correct insurance cover, which may be due to the increased cost of living, or to lack of awareness that specific insurance is required for all forms of business mileage. Drivers must also keep on top of the maintenance of their own or leased vehicle: another expense that they may struggle to cover.
Employers may also be inadequately risk-managing their grey fleet employees as they may not see them as people who drive for work. Companies are therefore not making the relevant checks as they would for their company car drivers, ever decreasing the visibility of the cars their employees are using for work journeys. This is increasingly looking like a trend that will continue as our work habits change.
- 4% of grey fleet cars were found to have illegal tyres, compared to just 1.6% of company cars.
- Grey fleet cars have a failure rate 10x higher than company cars for defective lights, 4x higher for defective brakes and 2x as high for an invalid MOT.
Stats link – https://www.fleetnews.co.uk/news/fleet-industry-news
Protect your grey fleet:
IAM RoadSmart offer a range of driver training courses and risk management solutions to help you achieve a safer, more efficient fleet. Our online risk management portal – CHOICES – has several integrated features that can protect your business whilst working with grey fleet drivers.
