Income Tax (Earnings and Pensions) Act 2003 section 155

Cash equivalent of the benefit of a van

Section 155 sets out how to calculate the cash equivalent of the taxable benefit arising from a van made available to an employee by their employer.

• If the van meets the restricted private use condition for the tax year, the cash equivalent is nil — meaning no van benefit charge arises.
• For zero-emission vans (those that cannot emit CO2 in any circumstances), the cash equivalent was a percentage of £3,500 for tax years 2015-16 to 2020-21, rising from 20% to 80%, and becomes nil from 2021-22 onwards.
• For all other vans that do not meet the restricted private use condition, the flat-rate cash equivalent is £3,600.
• The cash equivalent may be reduced for periods the van was unavailable, where the van is shared between employees, or where the employee makes payments for private use of the van.