SE65826 - Tax treatment of local authority officials and employees: payments for using own car for work - centrally negotiated National Joint Council rates - Fixed Profit Car Scheme - how to use the profit tables

Important note:

Both the statutory rules and the administrative arrangements for dealing with mileage payments are replaced by the new statutory scheme for approved mileage allowance payments (AMAPs) that applies from 2002/03 onwards. Full guidance on the AMAP scheme is at SE31250 onwards.

Rules up to and including 2001/02

The agreed profit tables are circulated in an appendix to a TS memo each year, normally in the March Noticeboard. The profit tables for local authority employees are calculated in the same way as for other fixed profit car schemes following the instructions in EP8000 onwards.

For each employer who pays at the centrally agreed mileage rates, you will need to take the following steps:

• Establish whether or not they are using the Fixed Profit Car Scheme to report profits.
• If they are, establish whether they are using the three engine size or two engine size ('restricted payments') variant.

This will enable you to identify the batch of profit tables which apply to that particular employer. You will then need to take the following steps to find the profit table which applies for each individual employee.

• Establish whether the employee is a casual user or an essential user.
• Find out the engine size band of the car used by the employee for business travel.

Districts may not enter into separate negotiations with local authorities about how to draw up the Fixed Profit Car Scheme profit tables for local authorities paying at the centrally negotiated rates without prior reference to Employment Income Technical.

In Scotland the figures for profits are different. The relevant tables are held in the Centre 1 Employers Office (P11D section) to which any enquiries regarding car allowances should be addressed.

In Northern Ireland, social work staff within the Health Service (see SE66716) come within the arrangements for local authority employees. The tables agreed for local authority employees will also apply to those individuals, if they are reimbursed at the National Joint Council rates.

Where an employee is an essential user for part only of a year of assessment, the assessable profit for that year attributable to essential user status is determined by converting the number of business miles travelled as an essential user to an equivalent annual figure. Then take from the appropriate table the profit corresponding to that annual figure and reduce it in the proportion that the period of essential user status bears to one year.

Where an employee is a casual user for part only of the year no such adjustment is required and the assessable profit attributable to casual user status is the profit in the appropriate table which corresponds to the number of business miles actually travelled as a casual user.

See SE65830 for details of where to find the profit tables for 1996/97 to 99/2000.