SE23493 - Car benefit from 2002/03 onwards: calculation for bi-fuel LPG car with an approved gas CO2 emissions figure (fuel type B): 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 SE23455.

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 £14,500.
• Gas CO2 emissions figure is 145g/km.
• Look up the appropriate percentage for 145g/km CO2 in the ready reckoner at SE23380.

2002/03

• Reduction of 1%, plus an additional 1% as the CO2 emissions figure is 20g/km below the 165g/km lower threshold for the year.
• Percentage charge is therefore 15% - 2% = 13%
• Basic car benefit charge is £14,500 x 13% = £1,885

2003/04 and 2004/05

• Reduction of 1% - no additional discount as the CO2 emissions figure is less than 20g/km below the lower threshold for those years.
• Percentage charge is 15% - 1% = 14%
• Basic car benefit charge is £14,500 x 14% = £2,030