P11D tips – Car and van benefits 2021/22
07 February 2022
Published by: Michael Hepburn, Senior Manager – Employment Tax
Accurate tracking and recording of car and van benefits are one of the main headaches when it comes to completing P11Ds and there were changes in 2020/21.
Car benefits - Section F
As well as the usual car benefit CO2 increases for 2021/22, don’t forget that the structure of benefit rates for cars with CO2 emissions below 50 g/km changed from April 2020. Not all hybrid cars are the same and to encourage drivers to choose the lowest emitting cars, and since April 2020, new cars in this range have a taxable benefit linked to their electrically powered range: cars with an electric range of 130 miles or more only trigger a 1% benefit whereas cars with an electric range of less than 30 miles trigger a 13% benefit.
It is also important to remember that the benefit rates for cars registered after 6 April 2020 are different to older cars. For new cars, HMRC now uses the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) and a slightly lower benefit rate than for older cars whose emissions were tested under the lees rigorous New European Driving Cycle (NEDC) tests.
For cars, the fuel benefit multiplier increased to £24,600 (x the appropriate percentage for the CO2 emissions) in 2021/22.
Van benefits – Section G
For vans, the benefit for unrestricted private use increased to £3,500 in 2021/22, and the van fuel benefit increased £669. For the use of zero emissions vans the benefit was reduced to zero for a fully electric van for 2021/22.
And don’t forget, there is no taxable benefit on workplace charging of electric vehicles.
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If you found this article helpful, read more at P11d tips: COVID-19 and benefits-in-kind.
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P11D is just one of the reporting deadlines that employers need to be aware of for 2022. Read our guidance on how to ensure you have accurate data ready in time to meet all the reporting deadlines: Employers’ Year End 2022