SE23161 - Car benefits: capital contributions; limit on the amount allowable

Section 168D(3)-(4) ICTA 1988

The amount that can be deducted from the price of the car under the rules explained at SE23160 is limited to the smaller of

• £5,000, or
• the total amount of all capital sums which the employee has contributed in the year in question or earlier towards the car or qualifying accessories which are included in the price of the car.

Capital contributions which were made before 6 April 1994 towards cars (or accessories) still available after that date will also qualify for deduction, provided the other conditions are satisfied.