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HMRC internal manual

Employment Income Manual

HM Revenue & Customs
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Van benefit from 2005/06: scope and prohibition of other tax charges

Sections 239 and 269 ITEPA 2003

The van benefit charge (see EIM22701) is the only charge on the benefit of a van available for private use except that a separate charge is made where

  • fuel is provided for a van for which the restricted private use condition (EIM22795) is not met (see EIM22900 onwards for guidance on the van fuel charge), or
  • exceptionally, expenses are incurred by or on behalf of the employer in providing a driver for the van, Section 239(5); see the residual benefit rules from EIM21001.

Note that there is no net charge under either of these exceptions unless fuel or driver are provided for private use.

When the benefit of a van is charged under Section 154 ITEPA 2003, or where it is not charged because private use in the year is insignificant (EIM22745), Section 202(1) ITEPA 2003 excludes it from the residual liability to charge in Part 3 Chapter 10. There is also no residual liability to charge on any benefit in connection with the van other than those noted above, so a benefit charge cannot also be made on the provision of, for example, insurance for the van.

But this exemption from the residual liability to charge for benefits in connection with the van does not extend to benefits that are also enjoyed by the employee when using a car or van for which that employee is not chargeable to tax, including their own vehicle. For example, the provision of a season ticket for a toll bridge.

There is also legislation forbidding any charge under other employment income provisions in addition to the van benefit charge for:

  • the discharge of any liability of the employee in connection with the van - see EIM00580 onwards, Section 239(1))
  • the reimbursement of expenses incurred by the employee in connection with the van (see EIM20601, Section 239(2)).
  • the use of a non-cash voucher or credit token to obtain, either directly or indirectly, goods or services in connection with the van (see EIM16100 and Section 269(1)).

There is no charge to tax for a mobile telephone fitted to a van, see EIM21780 onwards. For the treatment of hands-free kits for mobile phones see EIM21781.

For van parking at or near the employee’s place of employment see EIM21685.

For personalised number plates see EIM24290.