SE23800 - Pooled cars and vans: general

Section 159(1) to (3) ICTA 1988

Some employers, or groups of employers, find it convenient to have one or more cars or vans which are readily available for business use by a number of employees. The cars or vans are not allocated to any one employee and are only available for genuine business use. Such cars and vans are usually known as “pooled cars and vans”.

The legislation provides that no car or van benefit arises on a pooled car or van made available by reason of the employment which, in the relevant tax year, satisfies all the following conditions.

• It is available to, and actually used by, more than one employee and is not ordinarily used by any one of them to the exclusion of the others.
• Any private use of the car or van by any of the employees is merely incidental to its business use (see SE23801).
• It is not normally kept overnight on or in the vicinity of the residence of any of the employees except while it is being kept on premises occupied by the person providing the car or van (see SE23803).

For the purpose of these three conditions the “employee” need not be a director or employee within Part V Chapter II ICTA88.

The conditions to be met are essentially questions of fact. Each of them has to be considered in turn. It is not enough that a car satisfies two of them and narrowly fails the third. It must satisfy all three conditions. All the relevant facts should be obtained - preferably by way of interview - before a decision is taken.

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

All claims that a car or van is a pooled car or van should be considered by an Inspector (see SE23805).

As regards vans which are not pooled vans see SE22051 onwards.

As regards the apportionment of the car benefit and car fuel scale charges in cases where pool car status does not apply, see SE23075.