Budget 2008

Benefits in Kind

For directors, and employees earning at the rate of £8,500 or more per tax year including expense payments and benefits

Cars and fuel

• Benefit based on set percentage applied to list price (including accessories)* for a car and £16,900 (£14,400 2007/2008) for fuel.
• Set percentage determined by carbon dioxide emissions for car in grams per kilometre (g/km).
• Emissions not exceeding 120g/km and car not electrically propelled 2008/2009 onwards = 10%
• Emissions not exceeding 135g/km (140g/km 2007/2008) = 15%
  
  • increase for each whole 5g/km = 1%
  • supplement for cars running solely on diesel† = 3%
  • maximum percentage = 35%
• Special rules for alternative and mixed fuel cars, classic cars, automatic cars for disabled employees, cars without a carbon dioxide emissions figure and those registered pre 1 January 1998.
• Car benefit reduction available for capital (maximum £5,000) and private use contributions.
• Benefit reduced on a pro-rata basis if car or fuel not available for whole year subject to fuel anti-avoidance provisions.
• No fuel benefit if employee required to pay for and actually pays for all private fuel or if fuel is only provided for business journeys.

* Maximum price £80,000 after deducting any allowable capital contributions.
† Excludes Euro IV diesels registered before 1 January 2006.

Vans

• Not ver 3.5 tonnes £3,000*†
  
• Over 3.5 tonnes £nil‡
• Fuel for private use £500

* Per van - reduced by private use contribution and where the van is unavailable or shared.
† Nil if private use restricted to home to work travel.
‡ Unless used wholly or mainly for private purposes.
§ No fuel benefit if employee required to pay for and actually pays for all private fuel or if fuel is only provided for business journeys.

Cheap loans

• Benefit equivalent to excess of official rate* over interest charged.
• Exempt if loans total no more than £5,000.

* 6¼% (different rates may apply to foreign currency loans).