Paying tax for "perks"?
Mermaidspam · 26/04/2013 11:20
Dh has recently had a promotion to a management position. He works in IT development for a medium sized company. Because of this he gets various devices to test out, check suitability for the company, basically use for a while for whatever he wants. He currently has an ipad, a laptop and a kindle fire (has had these for 6 months - 1 year, before getting the new position).
He has just got an ipad mini but has been told that he needs to pay tax (not much - about £40 a year) on this as it is considered a "perk".
Also, he has just text to say the other items need to be handed back in because, otherwise he will have to pay the same amount of tax for each of these (so £160ish in total).
I know absolutely nothing about tax, so just wondered if someone could tell me if this was right?
Dh says "any second device which is mobile is now considered a perk. It's a tax dodge that the company are trying to palm off on us".
Essentially, AIBU to think that if testing an item is part of your job, you shouldn't have to pay anything for that item? I don't particularly care about the amount of £, it's the principal.
Justforlaughs · 26/04/2013 11:45
I know that you have to pay for perks, but I don't think you should have to pay for something that is part of your job. That's ridiculous. I suppose the only way round it is to only test during working hours. If everyone did that then the company would probably change their policy as they would spend far more in the extra wages than they will save through the tax breaks they get.
PigletJohn · 26/04/2013 11:53
I am struck by you saying "the other items need to be handed back"
Had you been thinking of them as presents to the family? If they were, then they would be taxable. If they were being used for business purposes or temporary testing (and then returned) they would not be.
It is also not unusual for other staff to say "Scroggins gets an ipad and a kindle and a coffeemaker all for free, why don't I ever get anything?" and if they are treated as gifts, this is a more awkward question.
As I see it.
Fillybuster · 26/04/2013 11:56
as I understand it, if he has them for testing/business purposes then they are not taxable or a perk, and the company possibly has its knickers in a twist.
if he gets to keep them full time, then they are a possibly a perk, but only if he doesn't need them for his job.
niceguy2 · 26/04/2013 12:02
The bottom line is this:
If the item in question is used 100% solely for business use and your DH can demonstrate this then there is no tax to pay. It simply isn't taxable.
The fact that you say that both you & your DD use it leads me to think that actually there is non-business use of said devices and so HMRC are perfectly entitled to say that there is 'benefit in kind' and so it is taxable.
ShellyBoobs · 26/04/2013 12:26
Dh says "any second device which is mobile is now considered a perk..."
That's because it's reasonable to say he needs a mobile phone or other device for contact when out of the office but it's not necessary to have 2 devices capable of the performing the same function.
Hence having 2 implies that there is a BIK rather than a business need.
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