This Content Was Last Updated on November 5, 2015 by Jessica Garbett

 

From 6 April 2015 any employer who provides to their employees certain low value benefits-in-kind (BiKs) will, in some circumstances, become exempt from income tax. The exemption provides a number of conditions that must be met for a BiK to qualify as trivial, including an upper limit per individual BiK of £50.

Individuals who currently pay income tax on certain low value BIKs provided by their employer, will become exempt from income tax.

The measure is intended to provide a simplification to the current approach for dealing with low value BiKs, whereby employers are required to agree with HMRC whether certain BiKs can be treated as trivial.

A statutory definition of a trivial BiK will provide certainty to employers as to the treatment of such BiKs, and therefore allow employers to identify them in ‘real-time’, avoiding the need to contact HMRC or report such BiKs on P11D or PAYE Settlement Agreement (PSA) forms after the end of the tax year.

Article by ACCA In Practice

Whitefield Tax - Isle of Wight Accountants - IR35 specialists
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