Activa logo Prev Next

Van benefit charge

Vans with CO₂ emissions greater than zero 2018/19 2017/18
Van benefit charge £3,350 £3,230

The van benefit charge is reduced to nil if there is only insignificant private use, the terms under which the van is made available to an employee restrict its private use or it is a pooled van.

Until 5 April 2022 the van benefit charge for a zero emission van will be a percentage of that applied to a conventionally powered van as follows:

Vans with zero CO₂ emissions Proportion of van benefit charge
2016/17 20%
2017/18 20%
2018/19 40%
2019/20 60%
2020/21 80%
2021/22 90%
2022/23 100%

The van benefit charge is reduced if the van is not used for the whole tax year, or, if someone else also uses the van for private travel or if something is paid by the employee for using the van privately.

Under the legislation governing Optional Remuneration Arrangements, for agreements made from 6 April 2017, if a cash allowance is offered but a company van is selected the van benefit charge will be the greater of the annual cash allowance and the cash equivalent of the van benefit. When calculating the cash equivalent to be compared against the cash allowance employee contributions should be ignored.

Similar rules apply for salary sacrifice.