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One-off £250 benefit in Kind. How will it be applied?
vacheron
Posts: 2,278 Forumite
in Cutting tax
Hi.
Our company is implementing a cycle to work scheme which I intend to use to buy a bicycle for £1000 which will be paid for by salary sacrifice over 12 months.
After 12 months the bike can be bought by the employee from the company for 25% of the original cost (£250) or alternatively, the employer could choose to gift the bike to the employee as a benefit in kind with just Tax and NI on the £250 to pay.
My question is how would an employer usually handle such a 1-off benefit in kind transaction? My hope is that it will appear on that months payslip as a payment but with a matching deduction to allow the tax / NI to be automatically calculated using PAYE. It seems overkill that employees would have to have their tax codes recalculated but being new to benefit in kind calculations I have no idea.
Can anyone shed some light please?
Thanks.
Our company is implementing a cycle to work scheme which I intend to use to buy a bicycle for £1000 which will be paid for by salary sacrifice over 12 months.
After 12 months the bike can be bought by the employee from the company for 25% of the original cost (£250) or alternatively, the employer could choose to gift the bike to the employee as a benefit in kind with just Tax and NI on the £250 to pay.
My question is how would an employer usually handle such a 1-off benefit in kind transaction? My hope is that it will appear on that months payslip as a payment but with a matching deduction to allow the tax / NI to be automatically calculated using PAYE. It seems overkill that employees would have to have their tax codes recalculated but being new to benefit in kind calculations I have no idea.
Can anyone shed some light please?
Thanks.
• The rich buy assets.
• The poor only have expenses.
• The middle class buy liabilities they think are assets.
• The poor only have expenses.
• The middle class buy liabilities they think are assets.
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Comments
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...My question is how would an employer usually handle such a 1-off benefit in kind transaction? My hope is that it will appear on that months payslip as a payment but with a matching deduction to allow the tax / NI to be automatically calculated using PAYE. It seems overkill that employees would have to have their tax codes recalculated but being new to benefit in kind calculations I have no idea.
Can anyone shed some light please?
...
Your employer has the option to payroll (most) benefits rather than put them on a P11D. You will have to ask them whether they do or not.0
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