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Finance Act 1981

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This is the original version (as it was originally enacted).

68Cars available for private use

(1)Section 64 of the Finance Act 1976 (cars available for private use) shall be amended as follows.

(2)In subsection (1) for the words following paragraph (b) there shall be substituted the words

then, for the purposes of the Income Tax Acts (and in particular section 204 of the Taxes Act (pay as you earn)) he shall be treated as being paid by his employer in that year an emolument of his employment of an amount equal to whatever is the cash equivalent of that benefit in that year.

(3)After subsection (2) there shall be inserted—

(2A)Where in any year a person is taxable in respect of the benefit of a car under this section, he shall not be taxable—

(a)under section 181 of the Taxes Act in respect of the discharge of any liability of his in connection with the car;

(b)under section 36 or 36A of the Finance (No. 2) Act 1975 in respect of any voucher or credit-token to the extent that it is used by him—

(i)for obtaining money which is spent on goods or services in connection with the car, or

(ii)for obtaining such goods or services;

(c)under section 60 above in respect of any payment made by him in respect of expenses incurred by him in connection with the car..

(4)At the end of subsection (5) there shall be inserted the words

but for the purposes of the said section 204 no adjustment to the cash equivalent shall be made by virtue of sub-paragraph (1) of paragraph 2 of Part II of that Schedule in a case in which sub-paragraph (2)(b) of that paragraph applies or by virtue of paragraphs 3 to 5 of that Part of that Schedule unless the inspector has notified the employer of the adjustment to be made.

(5)After subsection (5) there shall be inserted—

(6)Regulations under the said section 204 may prescribe the time or times at which the employer is to be treated for the purposes of that section as making payments in respect of the amount referred to in subsection (1) above and, where several times are prescribed, the parts of that amount to be treated as paid at those times.

(7)Where, by reason of any insufficiency in the payments actually made by an employer to an employee to whom he is treated as paying an amount by virtue of this section, the employer is unable in any year to deduct and cannot otherwise recover from the employee all the income tax in respect of that amount which he is liable to pay to the Board under the said section 204, the employer shall be treated as having provided a benefit in that year for the employee of an amount equal to the amount of tax which he is unable to deduct or otherwise recover which shall be chargeable to tax under section 61 above..

(6)In paragraph 5 of Part II of Schedule 7 to the said Act of 1976 (increase of cash equivalent where use of car for business travel does not amount to more than 1,000 miles) for " 1,000 " there shall be substituted

2,500.

(7)Subsections (1) to (5) of this section have effect for the year 1982-83 and subsequent years of assessment and subsection (6) of this section has effect for the year 1981-82 and subsequent years of assessment.

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