Q: I operate a greengrocers store in a small town and would like to offer my customers home delivery of goods. I want to buy a car or a van so that my employees can use it to make the deliveries. I am worried that there will be a tax charge on my employees. I am planning to lock the vehicle up behind the greengrocers’ shop every night.
A: You could buy a vehicle, either a car or a van as a pool vehicle.
If the conditions are satisfied then there will be no benefit in kind tax charge on any of the employees.
A vehicle qualifies as a pooled car if all the following conditions are satisfied:
- It is available to, and actually used by more than one employee;
- It is made available, in the case of each of those employees, by reason of their employment;
- It is not ordinarily used by one of them to the exclusion of others;
- Any private use by an employee is merely incidental to their business use of it;
- It is not normally kept overnight on or near the residence of any of the employees unless it is kept on premises occupied by the provider of the car.
Employers need to be able to demonstrate that the conditions for the car or van to be a pool vehicle have been met. It is a good idea to keep mileage records to show when the vehicle was used and by whom and for what journeys.
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