EIM22701 - Van benefit from 2005/06: scope - when it applies
Sections 114 and 154 ITEPA 2003
A special statutory regime imposes a benefit charge when a van
is made available for private use by a director or employee. This
applies to all those chargeable under the benefits code, i.e.
directors and employees except those in an excluded employment; see
EIM20007 for full details.
Finance Act 2004 changed the van benefits regime with effect
from 2005/06. It repealed former sections 155 to 166 (which related
to years to 2004/05) and replaced them by new sections 155 to 164
(relating to 2005/06 onwards). There is a summary of the new regime
in table form at
EIM22702 and details of the two-stage
transition at
EIM22705.
Scope – Section 114(1,3)
In a similar way to the car benefit regime, van benefit applies when:
- a van ( EIM22725)
- is made available ( EIM23050)
- to an employee (including a director) not in excluded employment ( EIM20007)
- or to a member of their family or household ( EIM20504)
- “without any transfer of the property in it” ( EIM23053)
- by reason of the employment ( EIM20504)
- and is available ( EIM23081) for private use ( EIM22740), and
- the benefit of the van does not constitute earnings from the employment by virtue of any other provision ( EIM22770).
Some references above are written in terms of cars; the same
rules apply to vans in those cases.
Unlike cars, there must be some actual private use before the
van benefit charge is incurred (
EIM22745).
Situations where the van benefit charge does not apply
Like the cars regime, the van benefit charge does not apply to
Unlike the cars regime, it does not apply to
- vans where private use is nil or insignificant ( EIM22745)
Nor does it apply to
- heavy goods vehicles (those with a design weight over 3,500 kg; EIM22990)
The cash equivalent
For a description of how the van benefit charge is calculated, see EIM22790.
Examples
These begin at EIM22870.
Years to 2004/05
Full guidance on van benefit for these years can be found using the contents page at EIM22050.
