Cars acquired by an employer on lease purchase and made available to employees where the full costs were recharged to the directors were subject to income tax and Class 1A NICs as benefits in kind, but HMRC discovery assessments were out of time as errors in returns were not brought about by carelessness.

Following an HM Revenue and Customs (HMRC) compliance visit to the first appellant (SSL) in April 2016, a dispute arose about the tax treatment of cars available for private use by the second and third appellants (BG and LG) and a family member. The cars had been acquired in SSL’s name under lease purchase agreements with a leasing company