Underpaid tax on Benefit in kind - big bill!

metallakitty

Hi,
The company that deals with my PAYE (I am directly employed by a disabled individual who employs them in a Case Management capacity) failed to tell me that very limited use of my employers car counted as a Benefit in Kind.
They told me, and another employee, to use it to commute during the pandemic, to protect our employer from the risk of us using public transport, and this has continued since then, due to strikes etc.
HMRC now want £3000 in back taxes because the CM company has told them about my use of the car.
Are they liable, as they didn't ever tell me it was a taxable Benefit and let it go on so long before telling HMRC?
I'm really worried, as it's a lot of money 😬

Albermarle

Bookworm105 said:

sorry but tax is a personal thing, ultimately you can't blame others for not knowing the rules yourself.

if you had free use of someone else's car and you used that car for personal trips (and that includes commuting) then you got a taxable benefit over and above the money you were paid as salary.

Surely though as the employer requested them to use the car instead of public transport, as part of their caring/protecting role, that it could be argued that the use of the car was necessary to do their job correctly/in line with the employers requests, so was entirely work related.
Of course if they also used it for other personal reasons, there would be some benefit in kind, but if they did not then there should not be ?
Even if there was, there would also be a humanitarian case for the employer to help out financially with some of the back taxes, as it was their request for the carer to use the car that has caused the problem.

Bookworm105

Albermarle said:

Bookworm105 said:

sorry but tax is a personal thing, ultimately you can't blame others for not knowing the rules yourself.

if you had free use of someone else's car and you used that car for personal trips (and that includes commuting) then you got a taxable benefit over and above the money you were paid as salary.

Surely though as the employer requested them to use the car instead of public transport, as part of their caring/protecting role, that it could be argued that the use of the car was necessary to do their job correctly/in line with the employers requests, so was entirely work related.
Of course if they also used it for other personal reasons, there would be some benefit in kind, but if they did not then there should not be ?
Even if there was, there would also be a humanitarian case for the employer to help out financially with some of the back taxes, as it was their request for the carer to use the car that has caused the problem.

crucial to this thread is what OP means by "commuting"
I took that to be OP commutes from their home to employers home using the employers car to avoid using public transport and thus risk contaminating the employer.
If that continued post covid, then the employer is providing transport from home to ordinary place of employment, aka a taxable benefit.
I agree financial help is a moral issue, 

Albermarle

If that continued post covid, then the employer is providing transport from home to ordinary place of employment, aka a taxable benefit.

I suppose then there will be an argument about when the Covid threat ended and 'post Covid' began, considering it is still around in a mild form. Tricky .

sheramber

What did you do when the other employee was using the car and what did they do when you were using it?

Did you not  go out in public?

eastcorkram

Should the OP not have received a P11D after the end of each tax year? Surely the employer can't just not issue that, and then issue 4 years worth?

sheramber

eastcorkram said:

Should the OP not have received a P11D after the end of each tax year? Surely the employer can't just not issue that, and then issue 4 years worth?

The employer may not have realised it was a benefit in kind or they may not have suggested it. 

It could have only just come to light through an audit or HMRC investigation.

Exodi

Do they want £3000 or have they reduced your tax code by £3000? (As if was a tax underpayment of £600 and you were a basic rate tax payer, they would need to reduce your tax allowance by £3000 to recover £600 through PAYE).

How long did you have use of the vehicle? £3000 seems like the amount of tax a basic rate tax payer would pay for use of an ICE vehicle for a couple of years (depending on the car).

MetaPhysical

Exodi said:

Do they want £3000 or have they reduced your tax code by £3000? (As if was a tax underpayment of £600 and you were a basic rate tax payer, they would need to reduce your tax allowance by £3000 to recover £600 through PAYE).

How long did you have use of the vehicle? £3000 seems like the amount of tax a basic rate tax payer would pay for use of an ICE vehicle for a couple of years (depending on the car).

Agreed. ICE company cars are outrageously expensive in tax terms, especially so if combined with a fuel card.  They are almost unfeasible.