Generally, the expenditure incurred by you or the lessor for the acquisition or delivery of the car. Usually, this is the purchase price that has been paid, although there may be arrangements in place that have an impact on the cost price. For example, where an employee provides a trade-in, the cost price would be the purchase price minus the trade-in.
Alternatively, where:

  • the transaction involves a payment by another person directly to a car dealer, the cost price would normally be the net amount you actually pay.
  • an employee pays an amount directly to you, you will need to look at the terms of any agreements and contracts in place to determine whether this payment is an employee contribution or not.

An employee contribution doesn’t reduce the cost price of the car.