Tax on company car whilst on Mat Leave??

[LMMontmomery]

Sorry for boring tax question but I have asked my employer (and been given an answer I don't fully understand) and have tried to google but with no success!

I have a fairly expensive company car which is a benefit in kind and which I pay tax for.

After three months of Mat leave I will revert to statutory maternity pay, does anyone know how the tax will work during this period (if the tax is taken out at the same rate as when I am paid normally there will be no money left!)

Finally I plan to take a year off and so for the final three months I won't be earning anything - how will the tax work for this period?

Hopefully there are some tax experts on here who can help me!

Thank you

Will your annual earnings drop below £8500 a year and thus take you out of P11d land

personally I'd hand the car back

Thankyou for this, my earnings will be above this so think I will get taxed, wish I had thought of handing the car back earlier!

When I went on mat leave (admittedly several years back now!) my SMP couldn't be reduced and my employer had to pay my childcare vouchers for 6 months.

Not sure how it works for tax though. See the non cash payments section here

www.gov.uk/guidance/statutory-maternity-pay-employee-circumstances-that-affect-payment

It will be added to your income for the year and be taxed at your marginal rate which is probably 20% if you are on SMP.

Thanks Both, I've checked out that link NearWildHeaven and it's really useful, thanks again .