Benefit in Kind

[NickFernandes]

Hi All,

Two questions please:

1. Some employees in my company organised an offsite to discuss company strategy which included the cost of travel to the venue, a meeting room space, food and overnight accommodation. This was paid for by the company.

Should all these costs be included as a taxable benefit (via a PSA return) or are they simply for business purposes therefore are exempt.

2. Some staff have subscriptions to the financial times which they use for work and is reimbursed by the company. Should this be considered a benefit or for business only

Thanks,
Nicholas

 

[Truemanbrown]

With regards to question 1, the costs will be allowable for the company with regards to Corporation Tax.

However, a benefit-in-kind will arise on any social aspect of the trip (I am assuming that there will be some evening social event taking place as well, such as an evening meal or party).

You may want to consider two possible courses of action:-

1. You may be able to obtain HMRC approval that the benefit falls within the exemption for annual parties and similar functions costing no more than £150 per attendee (if the £150 is exceeded, the whole amount is taxable as a benefit).

2. You could try and take advantage of the generous tax exemption for work-related training.

The exemption covers any training course or other activity designed to impart, instil, improve or reinforce any knowledge or skills or personal qualities which is, or is likely to be useful to the employee in performing the duties of any 'relevant employments' or which will qualify or better qualify the employee to undertake any relevant employment or such charitable or voluntary activities which could be undertaken in connection with the 'relevant employment'.

One way to do this would be to have the evening 'social' event between actual training, with the evening event designed to be motivational (or achieve some other betterment purpose). Care will be needed here to ensure the costs qualify.

 

[MyAccountantOnline]

...

1. You may be able to obtain HMRC approval that the benefit falls within the exemption for annual parties and similar functions costing no more than £150 per attendee (if the £150 is exceeded, the whole amount is taxable as a benefit).

...

Unless the OP's business is based at more than one location it wont qualify for the exemption as the event wasn't open to all employees - the OP stated ''some employees in my company''

 

[MyAccountantOnline]

...

2. Some staff have subscriptions to the financial times which they use for work and is reimbursed by the company. Should this be considered a benefit or for business only

Have a read of this https://www.gov.uk/expenses-and-benefits-personal-bills/what-to-report-and-pay

 

[UK Contractor Accountant]

"all taking in of professional literature and all that sort of expense, which enables a man to keep himself fit for what he is doing, are things which can none of them be allowed."

"a journalist does not purchase and read newspapers in the performance of his duties but for the purpose of ensuring that he will carry out his duties efficiently. If deductions of this kind were allowed in one case every journalist or other similar employee would claim to be entitled to deduct the payment made by him for every newspaper and periodical which he chose to purchase...and there would be no end to it. A sports reporter is employed to report sport, not to read newspapers, a photographer is employed to produce pictures for his newspaper not to study the pictures of others. An editor is employed to select, draft and arrange items in his newspaper, not to read other newspapers. A journalist who reads newspapers does so in order to be able to perform his duties to the highest possible standard but he does not read 'in the performance of his duties'."