Income Tax (Earnings and Pensions) Act 2003 section 158A

Van provided pursuant to optional remuneration arrangements: private use

Section 158A allows a deduction for payments an employee makes towards private use of a van provided under optional remuneration arrangements, reducing the taxable benefit calculated under section 154A.

• Where an employee is required to pay towards private use of a van provided under optional remuneration arrangements, and makes that payment by 6 July following the tax year, a deduction is allowed against the taxable benefit.
• The deduction equals the amount paid by the employee, but is capped at the amount needed to reduce the relevant taxable amount to nil — it cannot create a negative figure.
• The payment can be made by any means, including deduction from earnings or direct payment.
• Private use of the van includes use by members of the employee's family or household, not just the employee personally.