Cars were made available to employees

During a routine compliance visit HMRC queried the tax treatment of four cars available for private use by BG LG and their daughter who were directors of SSL. The company acquired the cars by lease purchase agreements. All costs relating to the cars were debited to the directors’ loan account although SSL paid those costs. The reason for this was to obtain the best finance rates from the leasing company.

HMRC raised assessments on the basis that cars taxable benefits (ITEPA 2003 s 114). The taxpayers appealed.

The First-tier Tribunal said the question of any liability had to be decided by reference to the statutory wording. The first question was whether the car was ‘made available (without any transfer of the property in it) to’ BG LG or their daughter - it was irrelevant by whom the car was made available. In this case ...