Car Benefit Question

Car Benefit Question

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Company has a pool car used genuinely for business purposes by different employees during the working week, but available to one employee at the weekend.
The arrangement is that the employee will take it home at the weekend for whatever use they want with it.
Is the MV benefit taxable in full on the employee or is there the possibility of only a proportion being taxable???
Paul

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By User deleted
20th Feb 2006 14:46

Guidance in Revenue Manuals may help your case...
It might be possible to argue that there is no benefit if you consider the 2 key indicators when a pool car can become a taxable benefit:

1. Incidental use - the private use is not significant compared to the business use. You imply that the employee has no restrictions on the use of the car at the weekend, so this may be difficult to use if a lot of mileage is driven, but still worth bearing in mind.

2. A pooled car is not generally seen to be kept regularly overnight at the employee's premises if less than 60% of the time. As the employee takes the car home only at the weekend, it would easily fall below 60%.

This guidance is published in the Revenue manuals and are provided as guidance as there is no definitive rules on this area. It probably would still be seen as a taxable benefit, but it may be worth checking whether the above could be argued!

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By neileg
17th Feb 2006 10:59

Slim chance
Car benefit is triggered by any private use at all, so even one day a year is enough.

However, if the car is unavailable for any day, and no substitute is provided, the benefit is reduced accordingly. Thus, if the employee is prevented in some way from driving the car at all during the week (including for business use), then you could argue that the benefit should be reduced by 5/7ths. This will be extremely difficult to establish, though, and it would need to be the case that the employee couldn't drive the car, not just that he didn't.

So in effect, I'm just agreeing with Phil!

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By AnonymousUser
16th Feb 2006 15:32

full charge

There is a full charge on the employee who takes it home because it is available to him for private use.

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