The vehicle scrappage or discount scheme is a voluntary scheme for motor dealers. Participating dealers will give buyers a £2,000 discount off the purchase price of a new car or small van in exchange for scrapping their old qualifying vehicle which must, amongst other criteria, be registered on or before 31 August 1999.
The scheme is expected to run from mid May 2009 to March 2010, unless funds are exhausted before then. For general information on the £2,000 scrappage discounts and the qualifying conditions for vehicles visit the Directgov link below.
HMRC have published their view on the tax implications of the car and van scrappage scheme. The guidance covers the business tax and VAT implications of the scheme.
If you have any queries on the tax implications of the scheme please do get in touch.
Source: Directgov website HMRC Brief