When a company car or van or fuel for private use is made available to an employee, there is deemed to be a benefit in kind - which means the employee has to pay tax on it.
Private use includes employees' journeys between home and work, unless they're travelling to a temporary place of work.
As an employer, you'll need to work out the taxable value so you can report this to HM Revenue and Customs (HMRC). The cash value of the car is added to the employee's salary and tax is then deducted from the final sum.
HMRC company car tax calculator
This official guidance and toolkit from HMRC explains how tax officers calculate the benefit and gives you an indication of much income tax is payable.
Find out about the tax treatment of company cars, vans and private fuel and use the HMRC Company Car and Car Fuel Benefit Calculator.
