I have a client who was made redundant in February 2020. As part of his compromise agreement it was agreed that he would continue to have use of his company car until 30 April 2020.
I have a copy of his P11D for 2019/2020 which shows a BIK in respect of the company car until the date he was made redundant in February 2020. His termination payment was in excess of the £30K exemption so any continuing BIK on the car will be taxable in full.
I am aware that he will be taxed on the continued use of the company car following the termination of his employment and that this continued use cannot be shown on his P11D.
My questions are:
- Where on the SA tax return do I enter the company car BIK for the remainder of the 2019/2020 tax year. Should this be included on SA101 amd of so in which box?
- Am I correct in thinking that the BIK calculation for the part of 2020/2021 tax year up until 30 April 2020 will be based on the normal company car BIK calculation method but that for 2019/2020 (year of being made redundant) as opposed to 2020/2021 (being the year the BIK is taxable)?
If I have misunderstood how this BIK should be taxed then I am happy to be pointed in the correct direction.
Thank you for your help.