TCTM04221 - Income: employment income rules - Specific payments and benefits in kind excluded from employment income for tax credit purposes: Taxable Car

»Ê¹ÚÌåÓýapp Tax Credits (Definition and Calculation of Income) Regulations 2002, Reg 4 (4) Table 1 (item 14B),(item 14C), (item14D)

»Ê¹ÚÌåÓýapp payment of expenses incurred by an employee in connection with a taxable car where no liability to income tax arises by virtue of section 239 (2) of ITEPA.

»Ê¹ÚÌåÓýapp discharge of any liability of an employee, in connection with a taxable car, if no liability to income tax arises, by virtue of section 239(1) of ITEPA.

Any benefit connected with a taxable car if no liability to income tax arises by virtue of section 239(4) of ITEPA.

Note: With effect from 6 April 2017 the way in which many salary sacrifice and benefit in kind schemes are taxed will change, which means that some tax credit claimants will see an increase in their taxable income.

For the purposes of tax credits, where one of these schemes is in operation the taxable income figure should be used.