Regulation 4 Prescribed condition in relation to replacement cars

(1)

The prescribed condition is that—

(a)

the replacement car is of similar quality to the replaced car, or

(b)

the replacement car is not made available to the employee under an arrangement of which the main purpose or one of the main purposes is to provide the employee with the benefit of a car which is materially better than the replaced car.

(2)

For the purposes of paragraph (1)(a) above the replacement car is of similar quality to the replaced car if it is neither materially better nor materially worse in quality than the replaced car.

(3)

For the purposes of paragraph (1)(b) above the replacement car is materially better than the replaced car if—

(a)

it is materially better in quality, or

(b)

it has a materially higher price.

(4)

For the purposes of paragraph (3)(b) above the price of a car shall be determined in accordance with the provisions contained in sections 168A to 168G of the Taxes Act^f1.

Annotations

Footnotes

f1: Sections 168A to 168G were inserted, with effect for the year 1994-95 and subsequent years of assessment, by paragraphs 4 and 7 of Schedule 3 to the Finance Act 1993.