EIM23141 - Car benefit: accessory: qualifying accessory (definitions)

Section 125 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 EIM23101 (this page concerns step 2)
• the general introduction to the treatment of accessories at EIM23140.

Definition of accessory, Section 125(2) ITEPA 2003

This includes any kind of equipment, but does not include:

• equipment necessarily provided for use in the performance of the duties of the employment (see EIM23180)
• equipment by means of which a car is capable of running on road fuel gas (see EIM23182)
• equipment to enable a disabled person to use a car (see EIM23181)
• a mobile telephone (within the meaning given in Section 319(2) ITEPA 2003, see EIM23183).

Note that the second condition does not apply in relation to a type B car, Section 125(3), see EIM23105.

Definition of qualifying accessory, Section 125(1) ITEPA 2003

This means an accessory that:

• is made available for use with the car without any transfer of the property (see EIM23053) in the accessory
• is made available by reason of the employment (see EIM20501 onwards) and
• is attached to the car (whether permanently or not).

The first condition means that you cannot include the price of those accessories that the employee owns, for example where an employee buys a new in-car stereo system for use in the company car.

The third condition: for example, a roof rack (that can be removed from time to time) will be a qualifying accessory if the other conditions are satisfied. Items like car rugs, loose tools or maps that are not attached to the car are not qualifying accessories and so are to be excluded when calculating the price of the car. In practice such items are likely to have a low price.