Company cars: fuel benefits - part 2

22 Jul 2019

In the part two of our series on company cars, Julie Clift CTA, tax writer at Croner-i, explains how to assess fuel benefits and tax liabilities

A taxable benefit arises when an employee is provided with fuel for private motoring (Income Tax (Earnings and Pensions) Act 2003, s149). There is no fuel charge where electrical energy is provided for an electronically propelled vehicle (ITEPA 2003, s149(4)).

No fuel charge arises where fuel is made available only for business purposes.

Benefit calculation

The fuel benefit each year is calculated by simply multiplying the appropriate percentage used to work out the benefit of the car by a fixed amount, which will be £24,100 for 2019-20.