EIM23001 - Car benefit: general
Part 3 Chapter 6 ITEPA 2003
In order to simplify the coding and assessment of the benefit
obtained by a director or employee who is chargeable under the
benefits code (not in an excluded employment (see
EIM20007)) from having a car made
available for private use, the normal rule for arriving at the
taxable value of the benefit described at
EIM21001 onwards is replaced by special
rules.
There are two main aspects to consider in respect of the car
benefit charge. These are:
- are the conditions present for a car benefit charge to apply and (if yes),
- what is the amount of the cash equivalent of that benefit (or car benefit charge)?
Does a car benefit charge apply?
Guidance on the conditions that need to be in place for a car benefit charge to apply begins at EIM23002.
What is the amount of the car benefit charge?
The cash equivalent of the benefit is calculated as a percentage (the “appropriate percentage”) of the price of the car. The appropriate percentage is based on the carbon dioxide (CO2) emissions of the car (see EIM23350 onwards). The charge is calculated according to a method statement at Section 121(1) ITEPA 2003 (see EIM23101).
Car benefit charge and car fuel benefit charge
There are two sets of benefit charges for provided cars:
