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HMRC internal manual

Employment Income Manual

Van benefit from 2005/06: scope - when it applies

Sections 114 and 154 ITEPA 2003

A special statutory regime imposes a benefit charge when a van is made available for private use by a director or employee. This applies to all those chargeable under the benefits code, i.e. directors and employees except for 2015/16 and earlier, those in an excluded employment; see EIM20007 for full details.

Finance Act 2004 changed the van benefits regime with effect from 2005/06. It repealed former sections 155 to 166 (which related to years to 2004/05) and replaced them by new sections 155 to 164 (relating to 2005/06 onwards). There is a summary of the new regime in table form at EIM22702 and details of the two-stage transition at EIM22705.

Scope - Section 114(1,3)

In a similar way to the car benefit regime, van benefit applies when:

  • a van (EIM22725)
  • is made available (EIM23200)
  • to an employee (including a director) not in excluded employment (EIM20007)
  • or to a member of their family or household (EIM20504)
  • “without any transfer of the property in it” (EIM23205)
  • by reason of the employment (EIM20504)
  • and is available (EIM23300) for private use (EIM22740), and
  • the benefit of the van does not constitute earnings from the employment by virtue of any other provision (EIM22770).

Some references above are written in terms of cars; the same rules apply to vans in those cases.

Unlike cars, there must be some actual private use before the van benefit charge is incurred (EIM22745).

Situations where the van benefit charge does not apply

Like the cars regime, the van benefit charge does not apply to

Unlike the cars regime, it does not apply to

  • vans where private use is nil or insignificant (EIM22745)

Nor does it apply to

  • heavy goods vehicles (those with a design weight over 3,500 kg; EIM22990)

The cash equivalent

For a description of how the van benefit charge is calculated, see EIM22790.


These begin at EIM22870.

Years to 2004/05

Full guidance on van benefit for these years can be found using the contents page at EIM22050.