Tax Code Confusion - Benefit in Kind Medical Insurance Tax

WhitehavenLass

Hi All, 

I am looking for as much advice and signposting as possible. 

I currently earn circa £65,200 with a tax code of 1120L. I have now received information from HMRC that my tax code next year will be 1074L meaning I am paying more tax. When looking at my deductions it shows I have deductions of £911 per year for Medical Insurance which is provided through my employer as well as suggesting I have an underpayment of £911 for previous years (see image). 

Please can someone advise if private medical insurance paid for by employers is usually taxed and if I should be querying this with HMRC. 

All help greatly appreciated 

Penguin_

Yes, it is a benefit paid for by the employer for you that you can access as & when needed. 

DullGreyGuy

Yes, you are getting the personal benefit of being able to claim of the employers policy without paying for it. Its the definition of a "benefit in kind" and therefore will appear on your P11D

PMI via work scheme tends to be vastly cheaper - my premiums went up 3x when I went from a corporate scheme  to a private one for the identical cover and since then my premiums have doubled again thanks to age and claims whereas I know the corporate scheme is almost unchanged. But as its effectively added to you salary not only is it cheaper but you are only paying your marginal rate of tax for it (ie if you are a 40% tax payer you are paying 40% of the price whereas I went on to pay 300% of the price)

Company cars, Xmas gifts of wine boxes etc are all other things that attract BIK because they give you personal benefit so need to be taxed.