EIM23800 - Car benefit: special cases: employees in the motor industry (from 2009/10): when is there a car benefit charge?
All employees chargeable to car benefit are subject to exactly the same legislation. Both the conditions under which car benefit is chargeable聽 and the calculation of the benefit charge apply equally to all. In particular, the decision in Pepper v Hart (65TC421) on marginal cost does not apply to car benefit.
However, HMRC recognises that problems arise in applying the law strictly in the聽3 situations described below. The guidance in this section (EIM23800 onwards) explains how HMRC applies the law in those situations. Similar guidance has existed since car benefit was introduced in 1976.
The聽3 situations are:
- test and experimental cars
- demonstrator and courtesy cars: is there a benefit charge at all?
- employees with frequent changes of car (鈥渁veraging鈥�)
The arrangements described in these pages seek to build on existing best practice and produce consistency for employers and employees in these situations.
Tax years up to and including聽2008 to 2009
This guidance applies only for tax year 2009 to 2010 and later years. Local arrangements applied for tax years up to 2008 to 2009 as described at EIM23750 onwards.