The Treasury make the following Order in exercise of the powers conferred by section 170(5) and (6) of the Income Tax (Earnings and Pensions) Act 2003(1).
This Order amends section 150(1) of the Income Tax (Earnings and Pensions) Act 2003 (“the Act”).
Where an employee receives fuel for a car by reason of his or her employment, the cash equivalent of the benefit of the fuel is treated as earnings from employment under section 149 of the Act and is subject to tax and national insurance contributions.
The cash equivalent of the benefit is calculated by applying the “appropriate percentage” (calculated by reference to the CO2 emissions of a car) to the figure of £14,400 in section 150(1) of the Act.
Article 2 of this Order increases the figure in section 150(1) of the Act to £16,900.
An impact assessment has not been produced for this instrument as no impact on the private or voluntary sectors is foreseen.
