SE23492 - Car benefit from 2002/03 onwards: calculation for hybrid petrol/electric car (fuel type H): example

From 6 April 2002, the car benefit charge is calculated by multiplying the ‘price of the car’ by the ‘appropriate percentage’ based on the car’s carbon dioxide (CO2) emissions.

This example shows how to do the calculations explained at SE23440.

In the following example the basic car benefit charge may be reduced if the employee has to pay for private use of the car ( SE23530 onwards) or if the car is unavailable for part of the year ( SE23500 onwards).

• Price of the car for tax purposes £17,000.
• CO2 emissions figure is 120g/km.

2002/03

• Reduction of 2%, plus an additional 2% as the CO2 emissions figure is 45g/km below the 165g/km lower threshold (see the ready reckoner at SE23380).
• Percentage charge is therefore 15% - 4% = 11%
• Basic car benefit charge is £17,000 x 11% = £1,870

2003/04

• Reduction of 2%, plus an additional 1% as the CO2 emissions figure is 35g/km below the 155g/km lower threshold for the year.
• Percentage charge is 15% - 3% = 12%
• Basic car benefit charge is £17,000 x 12% = £2,040

2004/05

• Reduction of 2%, plus an additional 1% as the CO2 emissions figure is 25g/km below the 145g/km lower threshold for the year.
• Percentage charge is 15% - 3% = 12%
• Basic car benefit charge is £17,000 x 12% = £2,040