Benefits in Kind
Benefits in kind are received by a great number
of employees and directors, particularly those with company cars.
The income tax implications of these benefits can be complicated
and so taxpayers need to understand the rules so that they can
properly prepare their self assessment tax returns and make decisions
about their future remuneration package.
Helpfully, HM Revenue & Customs do provide guidance on the correct tax treatment of various expenses and benefits: HMRC Website
Specific areas which we are typically asked to advise
on include:
- Understanding
the mechanics of the new company car tax rules,
- Minimising
the tax on company cars,
- Receiving non
taxable benefits in kind,
- PAYE coding implications of these benefits, including coding
out underpayments,
- Preparing forms P11d and calculating the resultant Class 1a
NIC liability.
Agreeing your benefits in kind with HM Revenue & Customs
is principally achieved by completing the employment supplementary
pages of a normal tax return. Clients who are fearful that these
benefits may be
investigated by HM Revenue & Customs may wish to consider taking
out our
fee protection insurance.
Understanding this complicated tax system and paying
the correct amount of tax, at the correct time, through the correct
mechanism, is what most clients seek. Speak to our tax technicians
and put your mind at ease. We may even be able to suggest ways
to restructure your remuneration package and save tax.
Practical Examples of our Benefits in Kind Expertise
- Preparing P11d's and calculating the class 1a NIC liability
once a year.
- Advising on whether a car is most tax efficiently owned
and expenses within the business or personally.
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