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HMRC internal manual

Employment Income Manual

Car benefit calculation Step 5, appropriate percentage, 2002/03 to 2005/06: low emission cars

Regulations 5 and 6 of The Income Tax (Car Benefits)(Reduction of Value of Appropriate Percentage) Regulations 2001, SI 2001 No. 1123 (as amended by SI 2005/2209)

This reduction only applied to cars in types H (EIM24820) and B (EIM24830), and then only for years from 2002/03 to 2005/06.

Cars of these types had their appropriate percentage reduced by a further 1% for each full 20 g/km that the car’s CO2 emissions figure was below the lower threshold (EIM24650).

This low emissions cars reduction was abolished after 2005/0 6.


The lower threshold for 2003/04 was 155 g/km. The effect on cars of types H or B was:

  • no reduction for a CO2 emissions figure of 136 g/km or higher (because 136 is only 19 below 155)
  • a 1% reduction for a CO2 emissions figure in the range 116 to 135 g/km
  • a 2% reduction for a CO2 emissions figure in the range 96 to 115 g/km
  • and so on.