EIM23440 - Car benefit: petrol/electric hybrid cars (type H until 2010/11)

Regulation 5 of The Income Tax (Car Benefits) (Reduction of Value of Appropriate Percentage) Regulations 2001, SI 2001 No. 1123 (as amended by SI 2005 No 2209)

This page relates to step 5 of the method statement in Section 121(1) ITEPA 2003, see EIM23101.

In petrol/electric hybrid cars, an internal combustion engine is combined with a battery electric traction system. The electric traction system must be capable of propelling the car in normal driving. It follows that a normal petrol car with an electrically powered starter motor is not a petrol/electric hybrid car.

It should normally be clear from the owner's manual or handbook if a car is a petrol/electric hybrid(This text has been withheld because of exemptions in the Freedom of Information Act 2000)

Years to 2010/11

Petrol/electric hybrid cars are shown as fuel type H on form P46(Car), the form that employers use to notify HMRC when cars are made available or changed, see EP2431.

Years to 2010/11: cars first registered on or after 1 January 1998: reduction in appropriate percentage

For years from 2002/03 to 2005/06 inclusive, the reduction is:

• 2%

plus 

• an additional discount of 1% for each full 20g/km that the CO2 emissions figure is below the qualifying level for the minimum charge for the year.

For years from 2006/07 to 2010/11, the reduction is 3%.

See example EIM23492.

Years from 2011/12 onwards

Petrol/electric hybrid cars are merged into new type A from 2011/12 onwards; see EIM23465. There is no reduction in the appropriate percentage from that year.

Cars first registered before 1 January 1998

See EIM23480. Remember that reductions do not apply to these cars.

Application to qualifying low emissions cars (QUALECs)

These reductions do not apply to QUALECs (EIM23402) from 2008/09, the first year for which the term is defined.

Diesel/electric hybrids

Although there are no diesel/electric hybrid cars at the time of writing (February 2008), these reductions will not apply to such cars once they become available. This is because the legislation only affects “cars capable of being propelled by electricity and petrol” (author’s emphasis).