Finance Act 2010

58 Zero and low emission vehicles

(1) Chapter 6 of Part 3 of ITEPA 2003 (taxable benefits: cars, vans and related benefits) is amended as follows.

(2) Section 139 (cars first registered in 1998 or later with emissions figure) is amended as follows.

(3) For subsection (1A) substitute—

“(1A) A car is a qualifying low emissions car for any year if it has a low CO₂ emissions figure for that year.”

(4) In subsection (1B), for “10%” substitute—

“(a) in a case where the car’s CO₂ emissions figure for the year does not exceed 75 grams per kilometre driven, 5%, and

(b) otherwise, 10%.”

(5) In subsection (5), for “this section” substitute “subsections (2)(b) and (3)(a)”.

(6) Omit subsection (5A).

(7) Section 140 (cars first registered in 1998 or later without emissions figure) is amended as follows.

(8) In subsection (3), for the words after “year is” substitute—

“(a) the special percentage if the car cannot in any circumstances emit CO₂ by being driven, and

(b) 35% in any other case.”

(9) After that subsection insert—

“(3A) The special percentage is—

(a) for the tax years 2010-11 to 2014-15, 0%, and

(b) for the tax year 2015-16 and subsequent tax years, 9%.”

(10) Omit subsection (4).

(11) In section 149(4) (car fuel benefit), for “for an electrically propelled vehicle” substitute “or any energy for a car which cannot in any circumstances emit CO₂ by being driven.”

(12) In section 155 (vans), for subsections (1) to (3) substitute—

“(1) The cash equivalent of the benefit of a van for a tax year is—

(a) nil in a case to which subsection (2) applies, and

(b) £3,000 in any other case.

(2) This subsection applies if—

(a) the restricted private use condition is met in relation to the van for the tax year, or

(b) the van cannot in any circumstances emit CO₂ by being driven and the tax year is any of the tax years 2010-11 to 2014-15.”

(13) In—

(a) section 156(1) (reduction for periods when van unavailable), and

(b) section 158(1) (reduction for payments for private use),

for “155(2)(a) or (b)” substitute “155(1)”.

(14) In section 160 (van fuel benefit)—

(a) in subsection (1), for “155(2)(b)” substitute “155(1)(b)”, and

(b) omit subsection (4).

(15) In section 170(1A) (power to amend section 155(2)(a) and (3)(b))—

(a) in paragraph (a), for “155(2)(a)” substitute “155(1)(a)” and after “employee” insert “or a zero-emission van”, and

(b) in paragraph (b), for “155(3)(b)” substitute “155(1)(b)”.

(16) In FA 2006, in section 59, omit subsection (7).

(17) In FA 2009, in Schedule 28, omit paragraph 7.

(18) The amendments made by subsections (2) to (16) have effect for the tax year 2010-11 and subsequent tax years.

(19) The amendment made by subsection (17) is treated as always having had effect.

(20) The amendment of section 142 of ITEPA 2003 made by paragraph 8 of Schedule 28 to FA 2009 has effect for the tax year 2010-11 (as well as for the tax year 2011-12 and subsequent tax years).