{"id":32127,"date":"2024-10-31T08:00:39","date_gmt":"2024-10-31T08:00:39","guid":{"rendered":"https:\/\/www.carandclassic.com\/magazine\/?p=32127"},"modified":"2024-11-04T16:21:31","modified_gmt":"2024-11-04T16:21:31","slug":"budget-breakdown-how-will-it-affect-classic-vehicle-owners","status":"publish","type":"post","link":"https:\/\/www.carandclassic.com\/magazine\/budget-breakdown-how-will-it-affect-classic-vehicle-owners\/","title":{"rendered":"Budget Breakdown \u2013 How Will it Affect Classic Vehicle Owners?"},"content":{"rendered":"

We recently reported on the latest news concerning the much speculated pay-per-mile<\/a> scheme, and the good news there was that it wasn’t going to be coming into effect anytime soon. We all rejoiced and there was much cheering. Hurrah! But the biggie – the actual government budget announcement<\/a> for the UK – was unveiled yesterday, which habitually brings with it bad tidings for us humble classic vehicle owners. But is the new Labour government’s first Budget in 14 years all doom and gloom or is Chancellor of the Exchequer Rachel Reeves on our side for once?<\/p>\n

\"\"<\/p>\n

Alongside the usual booze and fag tax amendments, all of our eyes and ears were duly fixed on the fuel duty announcements, and we’re happy to report that it’s good news here too, because the 5p fuel duty will be frozen until next year. Again, we rejoiced and there was more cheering. It may now be more expensive to fly on a private jet while sucking on a vape but the tax on fuel won’t change, and that’s a fair trade off if you ask us.<\/p>\n

There will be increases to the minimum wage as well as further planned investment for further education, too, but one of the more interesting announcements in this year’s budget is the increase in Capital Gains Tax (CGT) on the sale of assets. The lower rate of said tax will change from 10% to 18%, with the higher rate increasing from 18% to 24%. Great, you may be thinking, but what does that actually mean? Well, these increases just made non-taxable asset classes way more attractive, and we’ll give you one guess as to what a relevant non-taxable asset is to us petrolheads…<\/p>\n

\"Budget,<\/a><\/p>\n

Photo courtesy of Hagerty UK<\/a><\/em><\/p>\n

Yep, classic cars. Ten points to you. You see, cars designed for personal use, whether classic or not, are exempt from capital gains tax as ‘wasting assets’, i.e. they have a limited life span and they irreversibly decline in value over time, generally speaking, but the great unwashed don’t really care, because new cars, for the most part, depreciate the moment they’re driven off of the forecourt anyway. Classic and historic vehicles on the other hand often increase in value, as we’re sure anyone who’s tried to buy a classic fast Ford in recent years will attest. But that’s just one example of thousands of classic and historic vehicles<\/a> that are shooting up in value, whether due to restoration work, limited production numbers or just honest to goodness appreciation.<\/p>\n

\"Budget,<\/a><\/p>\n

So long as the car in question hasn’t been altered from its original \u201cpersonal use\u201d configuration (and by altered we mean things like modified for racing, for instance) it will remain exempt from CGT (don’t worry, the odd track day doesn’t count), and therefore the latest increases in said tax as outlined in the 2024 Budget. So, investing in a classic car, as we’ve been banging on about for years, is even more of a shrewd move now following the opening of the old red briefcase yesterday.<\/p>\n

The thing is, when most people think of investing, their minds usually go straight to stocks and shares, or perhaps property, but the rules are the same regardless and there is an investment market for anything collectible, sought after and appreciating in value. Things like art, wine and jewellery for instance, and of course, classic vehicles.<\/p>\n

\"\"<\/a><\/p>\n

But this lack of CGT is just one advantage to owning an old car. You can’t drive a stock. You can’t take an epic road trip down to the south of France with a share. With classic cars you get to actually enjoy your asset, all the while watching it increase in value without fear of being rinsed by the government when it comes time to cash in. As long as you look after it of course, and don’t bin it into a tree…<\/p>\n

\"\"<\/a><\/p>\n

Not all ‘classic’ cars will increase in value, however. You can’t just buy any old shed, hang on to it for a few years and expect to make a boat load of dough, so do your research if your goal is profit. Choose wisely though and you stand to be well rewarded when you come to sell in however many years time, safe in the knowledge that you won’t have to pay any inflated amounts of tax to the pesky HMRC. So rejoice for a third time and continue to cheer because your classic journey on the road to riches starts right here<\/a> on Car & Classic. With over 40,000 classic and specialist vehicles on site it’s a piece of cake to find a suitable steed, so get investing!<\/p>\n","protected":false},"excerpt":{"rendered":"

We recently reported on the latest news concerning the much speculated pay-per-mile scheme, and the good news there was that it wasn’t going to be coming into effect anytime soon….<\/p>\n","protected":false},"author":7,"featured_media":31674,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0},"categories":[2],"tags":[7177,15,1196,7106,7181,963,13,2133,7182,7179,693,11,546,4753,3396,7178,7184,7183,6896,14,7180,16,7105,6894],"yoast_head":"\nBudget Breakdown \u2013 How Will it Affect Classic Vehicle Owners? - Car & Classic Magazine<\/title>\n<meta name=\"description\" content=\"Yesterday saw Labour's first Budget announcement in 14 years but how does it all affect us as classic car owners? 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