Car/fuel benefit guidance There is an error in both the paper version of booklet CA 33 and on the employer CD-ROM (the Internet version is however correct). CA33 (2007) provides guidance on calculating Class 1A NIC liabilities for car and fuel benefits. The error is in the tabulation giving appropriate percentages for petrol-powered cars for 2005/06 to 2008/09 and affects cars with CO2 emissions of between 170 and 174 (g/km). For 2005/06 to 2007/08 the appropriate percentage is 21% (not 20% as stated) and for 2008/09 22% (not 21% as stated). For calculating the figures to enter on Forms P11D 2007/08, employers should use the table as reproduced in appendix 2, booklet 480, which show the correct figures. Employers should recheck 2006/07 completed forms P11D for cars with emissions between 170 and 174 (g/km). If the incorrect appropriate percentage of 20% was used, the employer should write to their PAYE tax office telling them about the error. The relevant employees will also need to be informed of the correct cash equivalent of the car(s) and associated fuel benefit for self-assessment tax purposes. Employers should not always assume that if the employee retains the same car in a new tax year, as used in the previous tax year, the percentage of the car’s list price taxed is also the same. The qualifying emissions level for the minimum petrol charge has continually been revised downwards since it was first used to calculate the car benefit, to reflect technological advances in CO2 levels emitted by cars. Hence, the figure may vary from year to year, altering the appropriate percentage to be applied to the car’s list price. Where the exact CO2 figure is not shown in the table, the CO2 emissions figure is rounded down to the nearest 5g/km i.e. for 173 use 170. Paul Tew, Pay Magazine Snowdrop provides a range of Payroll solutions that are fast, flexible and easy-to-use, to suit the many and varied needs of each organisation. To find out more about the software and services that we provide, please click here >>