Part 4

Employment income: exemptions
Chapter 3

Exemptions: other transport, travel and subsistence

Provision of cars for disabled employees
247
1
This section applies where a car is made available to a disabled employee without any transfer of the property in it.
2
No liability to income tax arises by virtue of Chapter 6 or 10 of Part 3 (taxable benefits: cars, vans etc. and residual liability to charge) in respect of the benefit if conditions A to C are met.
3
No liability to income tax arises in respect of—
a
the provision of fuel for the car, or
b
the payment or reimbursement of expenses incurred in connection with it,
if conditions A to C are met.
4
Condition A is that the car has been adapted for the employee’s special needs or, in the case of an employee who because of disability can only drive a car that has automatic transmission, it is such a car.
5
Condition B is that the car is made available on terms prohibiting its use otherwise than for—
a
the employee’s business travel, or
b
transport for the employee for the purpose of—
i
ordinary commuting or travel between any two places that is for practical purposes substantially ordinary commuting, or
ii
travel to a place the expenses of travelling to which would be within one of the training exemption provisions if the employer paid them.
6
Condition C is that in the tax year the car is only used in accordance with those terms.
7
In this section—
- “business travel” has the same meaning as in Chapter 6 of Part 3 (taxable benefits: cars, vans and related benefits) (see section 171(1)),
- “disabled employee” has the same meaning as in section 246 (see subsection (4)), and
- “the training exemption provisions” means—
- section 250 (exemption of work-related training provision),
- section 255 (exemption for contributions to individual learning account training), and
- section 311 (retraining courses).
8
Section 138(4) (when a car has automatic transmission) applies for the purposes of this section as it applies for the purposes of section 138.
Pt. 4 modified (10.6.2021) by Finance Act 2021 (c. 26), s. 26(3)