SolvedEIM22930 | Van fuel benefit from 2005 to 2006: if fuel withdrawn and not reinstated
From HM Revenue & Customs · Employment Income Manual
Section 163 ITEPA 2003
Reduction if fuel withdrawn and not reinstated in the same tax year
Under section 163(3) and (4) ITEPA 2003 the charge is proportionately reduced if for any part of a tax year:
the facility for the provision of fuel as mentioned in Section 160(1) ITEPA 2003 is not available (there is no provision of any fuel for any purpose)
the fuel is made available only for business travel
the employee is required to make good to the person providing the fuel the whole of the expense incurred by that person in connection with the provision of the fuel for the employee’s private use and the employee does make good that expense. From the 2017 2018 tax year, the latest date for making good the cost of all fuel provided for private use when calculating the van fuel benefit charge is by 6 July following the tax year in which the private fuel is provided.
The fact that any of the conditions above is met for part of a year shall be disregarded if there is a time later in that year when none of those conditions is met. In other words, there is no reduction if fuel is withdrawn but is reinstated later in the same tax year for the same van. It does not matter that fuel may still be provided for a different van because this legislation operates on a van-by-van basis. Facts concerning van one have no effect on liabilities in connection with van two.
Fuel can be withdrawn:
by the employer no longer providing free fuel for private use
by the employer requiring the employee to make good the cost of all private fuel provided after a set date and by the employee doing so (see EIM22945)
Note that there is no apportionment for days before provision of free fuel commenced.
The reduced amount is calculated according to the formula at EIM22925.
Other possible adjustments to the charge
The van benefit charge is also subject to adjustment as follows: