Income Tax (Earnings and Pensions) Act 2003 section 205B

Reduction of cost of taxable benefit where asset is shared

Section 205B deals with how the taxable benefit charge is reduced when an employer makes the same asset available for private use by more than one employee at the same time.

• When the same asset is shared among multiple employees for private use, the total taxable benefit for all those employees is capped at the annual cost of the benefit of that single asset.
• Each employee's share of the taxable benefit is determined by taking the full cost and then reducing it on a just and reasonable basis.
• The reduction ensures that the employer is not taxed multiple times on the full value of one asset simply because it is shared.
• An asset counts as available for an employee's private use if it is available for use by the employee themselves or by a member of their family or household.