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Benefits in Kind


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In following scenario:

 

Employee is on work from home contract but is in office 3 days a week, staying overnight in between. Company arranges and pays for train travel to and from office, and the hotel.

 

Am I right in saying that both are a benefit in kind as the office will still be classed as a 'permanent workplace'? and therefore employer will pay class 1A contributions on both via P11D? Will the employee incur any additional NI and/or PAYE expense?

 

Thanks in advance.

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Hi and Welcome to CAG

 

You wont get much response when posting as a scenario as poster's assume this is some kind of course work or research.

 

Is this hypothetical or actual problem ?

 

Regards

 

Andy

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Thanks for letting me know Andy. It is an actual problem-I am a Finance Manager trying to work out cost impact to my company and our new employee, but have limited experience of payroll. My studies are far behind me and just in need of a little guidance.

 

Thanks,

 

Louise

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Hi LH,

 

If you're Finance Manager to a company, I assume the company has either an accountant in-house or externally who can offer the exact answers you need.

 

In the meantime, I suggest that travelling costs paid by employer between home and work will almost certainly need to be considered in terms of possible BiK. Accommodation overnight may also be a BiK.

 

However, the circumstances need to be considered fully for each case before a definitive answer can be given.

 

Some HMRC guidance is here - https://www.gov.uk/expenses-and-benefits-travel/what-to-report-and-pay

 

:-)

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Hi, having spoken to my wife, who is a finance manager and deals with this, she says the following...

 

As well as the hotel and train tickets there is also another small cost to the business.

When you fill in the P11D's noting all benefits, the employee will have an increase in their PAYE payments the following year.

 

Once the P11D's are submitted your company will receive a bill from inland revenue and you will pay a percentage - like you pay employers NI. This isn't deferred to next year but is normally due within a few weeks of declaring.

 

It is not excessive but if you want an exact cost of hiring someone like this my wife suggests you call Inland Revenue, who she has found to always be extremely helpful in these matters.

Or, as the above post, if you have a chartered accountant doing your year end accounts you could ask them.

 

Regards

 

Andy

We could do with some help from you.

PLEASE HELP US TO KEEP THIS SITE RUNNING EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHERS

 

 Have we helped you ...?         Please Donate button to the Consumer Action Group The National Consumer Service

 

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