Reporting car and van benefits 2023/24

Published by: Michael Hepburn, Senior Manager – Employment Tax

HMRC issued guidance in January 2024 that, from April 2026, there will be a requirement for all employers to payroll benefits in kind (BIKs) on a mandatory basis rather than voluntarily as is currently the practice. Read our full article on payrolling benefits in kind.

There is still a requirement to complete form P11D for 2023/24 for any non-payrolled benefits. Accurately tracking and recording of car and van benefits can be one of the biggest challenges in completing P11Ds.

From April 2026, the same information will be required to payroll car and van benefits and it will need to be available on a real-time basis.

Car benefits

P11D Section F

The car benefit CO₂ rates for 2023/24 are the same as the prior year as they remain frozen until 2024/25. The rates for 2025/26 to 2027/28 have been published here.

Remember that not all cars with low emissions, below 50gr/km, are treated the same. To encourage drivers to choose the lowest emitting cars, new cars in this range of emissions have a taxable benefit linked to their electrically powered range. Cars with an electric range of 130 miles or more only trigger a 2% benefit whereas cars with an electric range of less than 30 miles trigger a 14% benefit.

It is also important to remember that the benefit rates for cars registered after 6 April 2020 are different to older cars. For new cars, HMRC now uses the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) and a slightly lower benefit rate than for older cars whose emissions were tested under the less rigorous New European Driving Cycle (NEDC) tests.

For cars, the fuel benefit multiplier increased to £27,800 in 2023/24.

Form P46(Car)

What is the P46(Car) form? In addition to the annual P11D, employers are also required to report the details of cars made available for private use to employees and directors on a P46(Car) form.

Reporting is required when a car is first provided, any additional cars are provided as well as when the individual ceases to have a car. The deadline for submitting the form to HMRC is 28 days from the end of the quarter in which there has been something to report so 3 May, 2 August, 2 November and 2 February each year. Form P46(Car) is also required for electric cars.

However, replacement cars can be notified to HMRC electronically or on the annual P11D.

For help with your P11D compliance and P46(Car) form, speak to our team or submit seamlessly direct to HMRC with our streamlined P11D software.

Van benefits

P11D Section G

For vans, the benefit for unrestricted private use increased to £3,960 in 2023/24, and the van fuel benefit increased to £757. For the use of zero emissions vans, the benefit is reduced to zero for a fully electric van.

It is worth remembering that there is no taxable benefit on workplace charging of electric vehicles.