Exemption for coronavirus related reimbursed home office expenses
The UK government is introducing an exemption so as employees who are reimbursed costs they incur purchasing home office equipment are not subject to tax on such amounts.
The expenditure must meet the following two conditions to be eligible for relief:
HMRC will exercise its collection and management discretion and will not collect tax and NICs due on any reimbursed payments made from 16 March 2020 (the date the UK government recommended working from home) until 5 April 2021.
If you have already subjected such payments to tax and NICs e.g. in the March 2020 pay cycle, we suggest contacting your payroll provider as soon as possible (if not Throgmorton).
This exemption is in addition to guidance previously issued by HMRC in response to COVID-19.
Company car benefit – ‘availability’
Your employee may have been furloughed or is working from home, because of coronavirus, and provided with a company car which they still have. You should treat the car as being made ‘available for private use’ during this period even if your employee is:
Where restrictions on movement applies because of coronavirus and prevents the car from being handed back or collected, HMRC will accept that a company car is unavailable in the following circumstances and therefore no benefit will arise:
Employer provided loans
A salary advance or loan to help your employee at a time of hardship counts as an employment-related loan. An interest free loan(s) provided with an outstanding value of no more £10,000 throughout a tax year are not taxable as a benefit in kind.
If you need further information please do not hesitate to get in touch with your usual Throgmorton contact or Jon Hanifan at [email protected]
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