SE23185 - Car benefits: calculation of price as regards a year; list price; capital contribution and accessories - example

Section 168A ICTA 1988, Section 168B ICTA 1988, Section 168C ICTA 1988, Section 168D ICTA 1988

When working through this example you may find it useful to refer to:

• the general introduction to the calculation of price of a car as regards a year atSE23100
• the flowchart setting out the steps involved in calculating the price of a car as regards a year atSE23100a.

An employee is provided with a car first registered on 1 January 1998.

The list price of the car with standard accessories, including VAT, number plates

and delivery is £ 18,590.

It is supplied with

• optional automatic transmission and air conditioning - prices for which are published by the car's manufacturer, in the following amounts

• an electrically operated radio aerial from an independent manufacturer with a list price of £95 (including tax, fitting etc).

All the optional accessories are qualifying accessories. The radio aerial has a price of less than £100 but it was made available at the time the car was made available and so the de minimis limit of £100 does not apply.

Calculation of the price of the car as regards 1998/99

In July 1999 the employee has a CD player fitted to the car. The CD player has a list price of £360 including fitting etc, to which the employee contributes £100.

In September 1999 the employee has roof rails fitted with a list price of £80 and contributes £50 to the cost.

Calculation of the price of the car as regards 99/2000

The price of the roof rails is not added because they are below the de minimis limit of £100 ( SE23150). The capital contribution towards them is not deducted because they have not been included in the price of the car ( SE23160 and SE23161).