Car Benefit

The car benefit is calculated by multiplying the car's list price, when new, by a percentage linked to the car's CO2 emissions.

For diesel cars generally add a 4% supplement (unless the car is registered on or after 1 September 2017 and meets the Euro 6d emissions standard).

The overall maximum percentage is capped at 37%.

The list price includes accessories.

The list price is reduced for capital contributions made by the employee up to £5,000.

Special rules may apply to cars provided for disabled employees.

2022/23:

CO2 emissions (gm/km)
% of car’s price taxed

0

2

1-50: Electric range >130

2

1-50: Electric range 70-129

5

1-50: Electric range 40-69

8

1-50: Electric range 30-39

12

1-50: Electric range <30

14

51-54

15

55-59

16

60-64

17

65-69

18

70-74

19

75-79

20

80-84

21

85-89

22

90-94

23

95-99

24

100-104

25

105-109

26

110-114

27

115-119

28

120-124

29

125-129

30

130-134

31

135-139

32

140-144

33

145-149

34

150-154

35

155-159

36

160 and above

37

2021/22:

CO2 emissions (gm/km)
Registered Pre 6/4/20: % of car’s price taxed
Registered After 5/4/20: % of car’s price taxed

0

1

1

1-50: Electric range >130

2

1

1-50: Electric range 70-129

5

4

1-50: Electric range 40-69

8

7

1-50: Electric range 30-39

12

11

1-50: Electric range <30

14

13

51-54

15

14

55-59

16

15

60-64

17

16

65-69

18

17

70-74

19

18

75-79

20

19

80-84

21

20

85-89

22

21

90-94

23

22

95-99

24

23

100-104

25

24

105-109

26

25

110-114

27

26

115-119

28

27

120-124

29

28

125-129

30

29

130-134

31

30

135-139

32

31

140-144

33

32

145-149

34

33

150-154

35

34

155-159

36

35

160 -164

37

37

165 and above

37

37

Car Fuel Benefit

Car fuel benefit applies if an employee has the benefit of private fuel for a company car.

The benefit is calculated by applying the percentage used to calculate the car benefit by a 'fuel charge multiplier'.

The charge is proportionately reduced if provision of private fuel ceases part way through the year. The fuel benefit is reduced to nil only if the employee pays for all private fuel.

Fuel charge multiplier: £25,300 (2021/22: £24,600)

Van Benefit

Van benefit is chargeable if the van is available for an employee's private use.

A fuel benefit may also be chargeable if an employee has the benefit of private fuel paid for in respect of a company van.

The charges do not apply to vans if a 'restricted private use condition' is met throughout the year.

A reduced benefit charge may apply to vans which cannot emit CO2 when driven.

Van benefit: £3,600 (2021/22: £3,500)

Fuel benefit: £688 (2021/22: £669)

Advisory Fuel Rates for Company Cars

Advisory rates only apply where employers reimburse employees for business travel in a company car or require employees to repay the cost of fuel used for private travel in a company car.

If the rate paid per mile of business travel is no higher than the advisory rate for the particular engine size and fuel type of the car, HMRC will accept that there is no taxable profit and no Class 1 NIC liability.

From 1 June 2022:

Petrol

Engine size (cc)
Pence per Mile

1400 or less

14

1401 to 2000

17

Over 2000

25

Diesel

Engine size (cc)
Pence per Mile

1600 or less

13

1601 to 2000

16

Over 2000

19

LPG

Engine size (cc)
Pence per Mile

1400 or less

9

1401 to 2000

11

Over 2000

16

Engine size (cc)
Pence per Mile

1400 or less

9

1401 to 2000

11

Over 2000

16

Notes…

  1. Hybrid cars are treated as either petrol or diesel cars for this purpose.
  2. The Advisory Electricity Rate for fully electric cars is 5 pence per mile. Electricity is not a fuel for fuel car benefit purposes.

Mileage Allowance Payments (MAPs) for employees

MAPs represent the maximum tax free mileage allowances an employee can receive from their employer for using their own vehicle for business journeys.

An employer is allowed to pay an employee a certain amount of MAPs each year without having to report payments to HMRC.

If the employee receives less than the statutory rate, tax relief can be claimed on the difference.

2022/23 and 2021/22:

Vehicle Type
Pence per Mile

Cars and Vans – up to 10,000 miles

45

Cars and Vans – over 10,000 miles

25

Bicycles

20

Motorcycles

24

Get in touch

If you are in the Lancashire area and are looking for support and advice from a team of professional accountants and business advisers, contact Coates & Co.

Coates & Co

2 Fairhope Avenue

Bare

Morecambe

Lancashire LA4 6JZ


Get In Touch

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