Non-taxable payments and benefits
Under general tax law, expenses payments and benefits made to certain directors and employees are taxable earnings (better known as remuneration).
As it is the case with most rules, there are exceptions where benefits or payments to an employee are not normally taxed:
• Annual parties or similar functions provided that the cost incurred by the employer for every employee is less than £150.
• Living accommodation related to the work.
• Equipment provided for disabled employees like a wheelchair or hearing aid and their private use
• The provision of goodwill entertainment for an employee.
• Late night taxis where an employee is provided with a taxi paid for by his employer for a journey from work to home.
• Work-related training expenses
• Long service and suggestion scheme awards provided that the cost to the employer does not exceed £50 per year of service for the employee.
• Meals and food vouchers where the vouchers are non-transferable, they are used
for meals only and the value of vouchers issued to employees does not exceed 15p for each working day.
• Mobile phones unless the calls paid by the employer can be converted into money by the employee.
• Parking spaces
• Removals expenses and benefits which exempts from tax the first £8,000 of removal expenses.
• Re-training expenses and courses for an employee who is about to leave or has left within the
previous year.
• Pensions on retirement or death
• Sports facilities generally available to the employer’s employees and members of their families
and households but not to the public.
• Medical treatment abroad
For more information on each of the non-taxable payments and benefits mentioned above just follow the HMRC link.
Alternatively, you can contact Taxfile‘s tax accountants in South London and Exeter for any query that you might have.