EIM23002 - Car benefit: when the charge applies: general

Section 114 ITEPA 2003

As explained at EIM23001, the first stage in looking at car benefits is to consider whether all the conditions for a car benefit charge to apply are present. If they are, the charge itself arises under Section 120 ITEPA 2003.

The conditions are set out in Section 114(1) and (3) ITEPA 2003. A car benefit charge applies when:

• a car (see EIM23020 onwards)
• is made available (see EIM23050)
• to an employee (including a director)
• (or to a member of their family or household) (see EIM20504)
• without any transfer of the property in it (see EIM23053)
• by reason of the employment (see EIM23060 onwards)
• and is available (see EIM23081) for private use (see EIM23080) and
• the benefit of the car does not constitute earnings from the employment by virtue of any other provision (see EIM23008).

In addition, the employee must be chargeable under the benefits code (not in an excluded employment, see EIM20007).