"Since April 2007, the benefit-in-kind (BIK) tax on employees for the private use of company vans and other commercial vehicles has increased six-fold, from £500 to £3000. In addition, if you provide fuel for this private use, your employee faces a further £500 fuel charge. A 700% increase overall. For an employee who pays base rate tax at 22%, that would mean an extra £660 on their annual tax bill, rising to £770 if they also have private use of company fuel.

Bad news for the employee, perhaps, but why should this concern you as a business? Well, BIK taxes are subject to employer's National Insurance (NI). Which means that any business that allows private use of its vehicles is also liable to 12.8% tax on that £3500. That's £448 per vehicle per year. A significant sum for any business, whether you're running a small or a large fleet."

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