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Benefits Code II: Not Low Paid Employees |
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benefit E. In Westcott v Bryan the expenditure was made for two distinct purposes only one of which was of benefit to the director. |
17A.3.7.2 Set-Off |
Where section 204 directs an apportionment, section 203(2) limits its charge to so much of the expense as is not made good by the employee, E. Where, therefore, a sum is to be apportioned and E receives a payment for the benefit, the question arises whether the expense is apportioned first and then the payment is set off against that apportioned figure, or whether the set-off occurs first and the apportionment is then applied to that reduced figure. The former would seem more correct but the latter view appears to have been accepted in Westcott v Bryan. |
17A.4 Particular Rules for Particular Benefits |
17A.4.1 Part 3 Chapter 6: Cars, Classic Cars, Pooled Cars and Vans |
In the United Kingdom company cars are much sought after. At present there are 2 million company car drivers and 22 m other car drivers. Tax treatment of company cars, however, has become more unfavourable. Today the taxable benefit arising from having a company car available for private use is significant. In addition, both employer’s NIC (class 1A) and PAYE may be chargeable. Company cars account for over half the new car registrations in Britain, and surveys routinely show that employees would keep their company cars even if all the tax advantages were abolished. |
17A.4.1.1 Car Available for Private Use: Basic Cash Equivalent |
Where a car is available for private use by reason of the employment, the employee is chargeable under ITEPA part 3 chapter 6, section 120, (ex section 157) on the cash equivalent of the benefit of the car being available for private use.90 Current rules which applied as from April 2002, based that cash equivalent on a mixture of the price of the car and a level of CO2 emissions. The level of CO2 emissions is set by ITEPA section 239 and contains lower figures for 2004–05 and, as a result of FA 2003, 2005–06. Where two members of the same family are provided with |