SE23122 - Car benefits: accessories; exceptions - cost of converting car to run on road fuel gases

Section 168AB(1) and (3) ICTA 1988, Section 60 FA 1998

Before reading the text that follows this paragraph, ensure that you are familiar with

• the general introduction to the calculation of price of a car as regards a year at SE23100
• the flowchart setting out the steps involved in calculating the price of a car as regards a year at SE23100a.

1998/99 to 2001/02

Under the accessories rules the cost of converting a car to run on road fuel gas is reflected in the calculation of the price of the car as regards a year. From 6 April 1998 the cost of equipment to enable a car to run on road fuel gas will not be treated as an accessory and therefore the cost of conversion to run on road fuel gas will not be added to the price of the car on which the car benefit is based.

2002/03 onwards

These rules also apply to these years, but are modified when the new system for calculating the chargeable car benefit is introduced from 6 April 2002 onwards. From that date, the cost of equipment to enable a car to run on road fuel gas will only be disregarded if the car does not have an approved carbon dioxide emissions figure for its performance when running on road fuel gas (i.e. if it is a type C car). See SE23445 onwards for details on what constitutes type B and type C cars.

• If the car is a type B one for car benefit purposes, use its actual price – including any cost of conversion – as the basis for calculating the car benefit.
• If the car is a type C one for car benefit purposes, continue to disregard from the price the cost of conversion to run on road fuel gas.

Road fuel gas

This means any substance which is gaseous at a temperature of 15ºC and under pressure of 1013.25 millibars, and which is for use as a fuel in road vehicles The two main types of road fuel gas which are currently in use are compressed natural gas (CNG) and liquid petroleum gas (LPG).