NIM16022 - Class 1A National Insurance contributions: Special Class 1A NICs cases: Cars provided for private use: Cars provided to disabled drivers: Cars provided for home to work travel only

Section 10(9) of the Social Security Contributions and Benefits Act 1992 (SSCBA 1992)

Regulation 38 of the Social Security (Contributions) Regulations 2001 (SSCR 2001) (SI 2001 No 1004)

Exception from Class 1A NICs

If a car is made available to a disabled person, no Class 1A NICs liability arises where:

• the car is made available by reason of the person’s employment; and
• because of their disability the car is made available to assist the employee in travelling between their home and place of employment; and
• the terms, on which the car is made available to the employee, prohibit any private use other than by the disabled employee in travelling between their home and place of employment; and
• no prohibited private use of the car is made.

To satisfy this exemption all of the above conditions must be satisfied.

If other private use is permitted, Class 1A NICs liability arises.

For the definition of disabled driver see NIM16025.

Income tax

The NICs rules differ from the tax treatment of cars provided to disabled employees. The tax rules are explained at EIM23650.