C1Part I Contributions
Class 1A contributions
10 Class 1A contributions.
1
Where—
a
for any tax year an amount in respect of a car is by virtue of section 157 of the M1Income and Corporation Taxes Act 1988 chargeable on an earner to income tax under Schedule E; and
b
the employment by reason of which the car is made available is employed earner’s employment,
a Class 1A contribution shall be payable for that tax year, in accordance with this section, in respect of the earner and car in question.
2
The Class 1A contribution referred to in subsection (1) above is payable by—
a
the person who is liable to pay the secondary Class 1 contribution relating to the last (or only) relevant payment of earnings in the tax year in relation to which there is a liability to pay such a contribution; or
F1b
if paragraph (a) above does not apply, the person who, if the benefit in respect of which the Class 1A contribution is payable were earnings in respect of which Class 1 contributions would be payable, would be liable to pay the secondary Class 1 contribution.
3
A payment of earnings is a “relevant payment of earnings” for the purposes of subsection (2) above if it is made to or for the benefit of the earner in respect of the employment by reason of which the car is made available.
4
The amount of the Class 1A contribution referred to in subsection (1) above shall be—
a
the Class 1A percentage of the cash equivalent of the benefit of the car to the earner in the tax year; or
b
where for the tax year an amount in respect of fuel for the car is by virtue of section 158 of the M2Income and Corporation Taxes Act 1988 also chargeable on the earner to income tax under Schedule E, the aggregate of—
i
the Class 1A percentage of the cash equivalent of the benefit of the fuel to the earner in the tax year; and
ii
the amount mentioned in paragraph (a) above,
the cash equivalents of the benefit of a car or fuel being ascertained, subject to the provisions of this section, in accordance with section 157 or, as the case may be, 158 of the Income and Corporation Taxes Act 1988 and Schedule 6 to that Act.
5
In subsection (4) above “the Class 1A percentage” means a percentage rate equal to the percentage rate F2specified as the secondary percentage in section 9(2) above for the tax year in question.
6
In calculating for the purposes of subsection (4) above the cash equivalent of the benefit of a car or fuel—
F3a
the car shall not be treated as being unavailable on a day by virtue of paragraph 9(c) of Schedule 6 to the Income and Corporation Taxes Act 1988 for the purposes of section 158(5) of that Act F4 or paragraph 3 or 6 of that Schedule, unless the person liable to pay the contribution has information to show that the condition specified in paragraph 9(c) is satisfied as regards that day;
b
the use of the car for the earner’s business travel shall be taken–
i
for the purposes of sub-paragraph (1) of paragraph 2 of that Schedule to have amounted to less than 18,000 miles (or such lower figure as is applicable by virtue of sub-paragraph (a) of paragraph 3 of that Schedule); and
ii
for the purposes of sub-paragraph (2) of paragraph 2 of that Schedule to have amounted to less than 2,500 miles (or such lower figure as is applicable by virtue of sub-paragraph (b) of paragraph 3 of that Schedule),
unless in either case the person liable to pay the contribution has information to show to the contrary; and
c
for the purposes of F5paragraph 4 of that Schedule, the car shall be treated as not having been the car used to the greatest extent for the employee’s business travel, unless the person liable to pay the contribution has information to show the contrary.
7
8
A person shall be liable to pay different Class 1A contributions in respect of different earners, different cars and different tax years.
F78A
No Class 1A contribution shall be payable in respect of the making available of a car, or the provision of fuel, if a Class 1B contribution is payable in respect of it.
9
F6The Treasury may by regulations provide—
a
for persons to be excepted in prescribed circumstances from liability to pay Class 1A contributions;
b
for reducing Class 1A contributions in prescribed circumstances.
Pt. I (ss. 1-19): power to modify conferred (7.2.1994) by 1993 c. 49, s. 35, Sch. 1 Pt. I para. 5(3)(d); S.R. 1994/17, art. 2
Pt. I (ss. 1-19) amended (1.4.1999) by 1999 c. 2, s. 3(1)(7); S.I. 1999/527, art. 2(b), Sch. 2