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Any payroll accounts out there?

4 replies

annualleavepurchase · 06/01/2020 10:57

Does purchasing annual leave reduce my taxable income?
I can't get a straight answer from my work place.

OP posts:
Convict225 · 06/01/2020 11:03

Presumably. Does purchasing annual leave mean the same as taking unpaid leave?

Charmatt · 06/01/2020 11:11

Yes it does - you purchase it before tax is deducted.

ohprettybaby · 06/01/2020 11:11

The way it is calculated should be stated somewhere in your company's policies. You will forfeit salary to buy the additional holiday. So, it will reduce your income per se which will, as a consequence, reduce your taxable income.

annualleavepurchase · 06/01/2020 11:25

It comes off as a 'loan' payment on payslip.
Really I'm looking to find out how HMRC view it. Whether it's a taxable benefit or not.

Yes it does - you purchase it before tax is deducted.

That's what I'm hoping for.

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