Author: Nicola Porter
Published: August 5, 2015
Reading time: 1 minute
This article is 6 years old.
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It has been brought to light this week that HMRC will be launching an investigation to ensure that employees are paying the correct amout of Benefit in Kind tax (BiC) on company cars that they use.
If employees are using demonstrator vehicles or courtesy vehicles as a company vehicle, and therefore changing them on a regular basis, you must ensure that their usage of each vehicle is logged correctly and also the correct tax banding given to each period of usage.
This can either be done manually or through use of accountancy software, but the employer must make sure their records are clear and up to date, in order that tax can be calculated correctly. Even if an employee borrows a luxury vehicle just for a weekend, this must be correctly recorded, as that vehicle will carry a higher tax band than their usual vehicle and as such must be accounted for.
HMRC are looking to commence investigations as soon as possible and therefore we advise dealers look at their recording procedures as soon as possible.