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HMRC internal manual

Employment Income Manual

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Car benefit calculation Steps 1-6, 2011/12 onwards: diesel car (type D): example

This page illustrates steps 5 and 6 of the method statement in Section 121(1) ITEPA 2003, see EIM24015 and the example shows how to do the calculations explained at EIM24855.

Example 1: Diesel car with a low approved CO2 emissions figure

The price of the car and accessories (the figure at step 3) is £15,000. The approved figure of CO2 emissions is 119g/km.

First, check whether the car is

  • for 2011/12 only, a QUALEC (EIM24605), or
  • for 2012/13 to 2014/15, a car with CO2 emissions between 1-75 g/km (EIM24610).

If it is not, round the CO2 emissions figure down to 115 g/km, then look up the appropriate percentage for a type A car at in the ready reckoner at EIM24705.

Finally, make any required adjustments for this type of car (see EIM24730).

2011/12

The car is a QUALEC: the unrounded CO2 emissions figure of 119 exceeds 75 but does not exceed 120, EIM24605.

The appropriate percentage (the figure at step 5) is 10% (EIM24605). Add the 3% diesel supplement (EIM24730). The basic car benefit charge (the figure at step 6) is £15,000 x 13% = £1,950.

Example 2: Diesel car with a high approved CO2 emissions figure

The price of the car and accessories (the figure at step 3) is £20,000. The approved figure of CO2 emissions is 217g/km.

First, check whether the car is

  • for 2011/12 only, a QUALEC (EIM24605), or
  • for 2012/13 to 2014/15, a car with CO2 emissions between 1-75 g/km (EIM24610).

If it is not, round the CO2 emissions figure down to 215g/km, then look up the appropriate percentage for a type A car in the ready reckoner at EIM24705.

Finally, make any required adjustments for this type of car (see EIM24730).

2011/12

The car is not a QUALEC, so the appropriate percentage from the ready reckoner is 33%. Add 3% diesel supplement, subject to a maximum at step 5 of 35%. The appropriate percentage (the figure at step 5) is therefore 33% + 2% (restricted) = 35%. The basic car benefit charge (the figure at step 6) is £20,000 x 35% = £7,000.