EIM24400 - Car benefit calculation Steps 1-4, classic car: definition
Section 147 ITEPA 2003
Before reading the guidance that follows this paragraph, ensure that you are familiar with the method statement in Section 121(1) ITEPA 2003, see EIM24015 (this page concerns steps 1-4).
Why the legislation exists
There is special legislation to deal with the benefit of certain classic cars because their list price will be low compared with their current value.
A classic car is one where:
- the age of the car at the end of the year of assessment is 15 years or more and
- the market value of the car for the year is £15,000 or more and
- that market value exceeds the amount carried forward from step 3 of Section 121(1) ITEPA 2003.
Effect of the section
The market value (see EIM24405) of a classic car, less any allowable capital contributions (see EIM24410) made, replaces the figure that would otherwise be carried forward from step 3 of Section 121(1) ITEPA 2003.
See example EIM24460.