Peugeot 3008 Hybrid4 now cheaper for businesses

HM Revenue & Customs has confirmed the car will not be hit with a three per cent charge on top of its company car tax like other diesel cars because of the electric aspect of its engine setup.

All cars used as business models in the UK are charged Benefit-in-Kind tax which is based on the CO2 emissions of the car in question.

Cars with sub-100g/km of CO2 emissions are eligible for the ten per cent rate of tax but diesel cars, even if they fall below the 100g/km mark, will have to pay 13 per cent BIK tax.

This is because diesel cars emit other pollutants such as particulates which can affect air quality in city areas and create soot.

However, the Peugeot 3008 Hybrid4 is the first car sold in the UK to use a diesel engine and an electric motor in a hybrid system.

The diesel engine drives the rear wheels and the electric motor the front wheels to deliver four-wheel drive but the use of electricity means it offers just 99g/km of CO2 emissions.

For private drivers, this means free road tax and exemption from the London congestion charge. Now it will also mean lower BIK tax for businesses.

The five-seat MPV crossover, winner of the What Car? Car of the Year in 2010, went on sale earlier this year in hybrid form.

Prices for the Peugeot 3008 Hybrid4 start from around £27,000 in the UK but standard diesel versions start from £17,000.

Before the Peugeot 3008 Hybrid4, diesel hybrid cars were considered too expensive to produce. Hybrid cars tend to have a petrol-electric powertrain instead.

However, the system will soon appear on the Citroen DS5 executive car when it arrives in Citroen dealerships in 2012.