Section 247 — Income Tax (Earnings and Pensions) Act 2003: Provision of cars for disabled employees

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.