Finance Act 2002

34 Car fuel: calculation of cash equivalent of benefit U.K.

(1) In Part 5 of the Taxes Act 1988 (provisions relating to the Schedule E charge), section 158 (benefits in kind: car fuel) is amended as follows.

(2) For subsections (2) to (2B) (calculation of cash equivalent) substitute—

“(2) Subject to the following provisions of this section, the cash equivalent of that benefit is the appropriate percentage of £14,400.

The “appropriate percentage” means the appropriate percentage determined under Schedule 6 for the purpose of calculating the cash equivalent of the benefit of the car for which the fuel is provided.”.

(3) In subsection (4) (power to substitute different amounts by Treasury order), for “a different Table for any of the Tables in subsection (2) above” substitute “ a different amount for that specified in subsection (2) above ”.

(4) For subsection (5) (proportionate reduction where car unavailable for part of the year) substitute—

“(5) The cash equivalent of the benefit in any year is proportionately reduced (see subsection (8) below) if the car for which the fuel is provided is unavailable (within the meaning of Schedule 6) for any part of the year.”.

(5) After subsection (6) (nil cash equivalent where fuel provided on terms that employee meets cost of private use or fuel is made available only for business travel) insert—

“(6A) The cash equivalent of the benefit in any year is proportionately reduced (see subsection (8) below) if for any part of that year—

(a) the facility for the provision of fuel as mentioned in subsection (1) above is not available, or

(b) the employee is required to make good to the person providing the fuel the whole of the expense incurred by him in connection with the provision of the fuel for his private use and he does so, or

(c) the fuel is made available only for business travel.

(6B) The fact that any of the conditions specified in subsection (6A) above is met for part of a year shall be disregarded if there is a time later in that year when any of those conditions is not met.”.

(6) At the end of the section add—

“(8) Where the cash equivalent falls to be proportionately reduced under subsection (5) or (6A) above (or under both those subsections), the reduced amount is given by:

where—

CE is the amount of the cash equivalent before any reduction; and

D is the total number of days in the year on which either the car is unavailable or one or more of the conditions in subsection (6A) above is met.”.

(7) After that subsection add—

“(9) References in this section to fuel do not include any facility or means for supplying electrical energy for an electrically propelled vehicle.”.

(8) This section has effect for the year 2003-04 and subsequent years of assessment.