SE23773 - Car fuel benefit: no fuel for private use; "making good" car fuel provided for private use

Section 158(6)(a) ICTA 1988

Where any fuel is provided for a car which attracts a Section 157(1) car benefit tax charge, the car fuel benefit charge will automatically apply unless the director or employee shows

• that he or she is required to make good to the person providing the fuel the whole of the expense of providing it for his private use and in fact does so, or
• that fuel is made available only for business travel.

For the meaning of "private use" and "business travel" see SE23080.

Where the director or employee is required to make good the cost of all fuel provided for private use this may be done by

• payment - that is by paying the employer a sum of money either directly or by deduction from his or her salary or wages, or
• reinstatement - that is by replacing fuel provided by the employer (or another person on behalf of the employer) by a corresponding amount of fuel purchased from his or her own pocket, or
• any combination of the ways described above.

So long as suitable measures are in place to administer this, you can normally accept an employer's statement

• that the employees are required to "make good" car fuel provided for private motoring, and
• that they actually do so.

For guidance on the use of Advisory Fuel Rates when deciding the amount to be "made good", see SE23773a.

2003/04 onwards

The car fuel benefit has a different basis for these years. See the contents page at EIM23700.