As an employer, if you provide company cars or fuel for your employees’ private use, you’ll need to report this to HM Revenue and Customs (HMRC).
For Company cars (not vans), ‘Private use’ includes employees’ and journeys between home and work, unless they’re travelling to a temporary place of work.
Information on the car details are usually submitted to HMRC through the payroll during the tax year. A P11D expense and benefit form is then submitted to HMRC following the end of the tax year to confirm the total benefit provided for that tax year. A tax calculation will then be performed by HMRC and any under or over payment of tax will be dealt with during the new tax year. This will be carried out by adjusting the employee’s tax code accordingly to be spread out over the remainder of that tax year.
The benefit in kind figure or cash equivalent is calculated by using the appropriate percentage, depending on the CO2 emissions figure and the original manufacturer’s list price of the vehicle. For diesel cars, there is an additional supplement of 4% to add on to the appropriate percentage figure. The table below shows the current figures:
|CO2 emissions in grams per kilometre||Appropriate Percentage (Electric & Petrol Vehicles)||Adjustment to Appropriate Percentage (Diesel Vehicles)|
|2018-19 2019-20||2018-19 2019-20|
|0 ( Electric )||13% 16%||N/A|
|1 - 50||13% 16%||
Add 4% up to a maximum of 37% for diesel cars that are not certified to the Real Driving Emissions 2 (RDE2) standard.
Add 0% for cars which are certified to the RDE2 standard.
|51 - 75||16% 19%|
|76 - 94||19% 22%|
|95 - 99||20% 23%|
|100 - 104||21% 24%|
|105 - 109||22% 25%|
|110 - 114||23% 26%|
|115 - 119||24% 27%|
|120 - 124||25% 28%|
|125 - 129||26% 29%|
|130 - 134||27% 30%|
|135 - 139||28% 31%|
|140 - 144||29% 32%|
|145 -149||30% 33%|
|150 - 154||31% 34%|
|155 - 159||32% 35%|
|160 -164||33% 36%|
|165 -169||34% 37%|
|170 - 174||35% 37%|
|175 - 179||36% 37%|
|180 or more||37% 37%|
(Information correct as at 18/06/2019)
You may also find the following website useful for obtaining the CO2 emission figures: https://vehicleenquiry.service.gov.uk/
HMRC have a Company car and car fuel benefit calculator which can be used: http://cccfcalculator.hmrc.gov.uk/CCF0.aspx
HMRC allow ‘insignificant private use’ which is usually to and from home to work and the occasional private journey (for example a couple of trips to the tip per year). If the use could be classed as ‘insignificant’ then there would be no benefit in kind.
If there is significant private use, van benefit will be chargeable and this will also need to be reported on a P11D expense and benefit form to HMRC.
There is a standard van benefit value of £3,350 per year for 2018/19 that you’ll need to report (increasing to £3,430 for 2019/20). This is regardless of the make, model or value of the van.
There is also a standard value of £633 per year for 2018/19 for van fuel benefit (increasing to £655 for 2019/20). This will need to be included as well if the company pays for private fuel. This can be reduced to zero if the employee pays back all of their private fuel used.
Please note: This report is provided for information only. No action should be taken without consulting detailed legislation or seeking independent professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this report can be accepted.