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News Items – at 28th March 2007
Acas has published a new booklet, Managing conflict at work. It is designed to help employers and employees better understand and manage conflict at work. It covers the signs, causes, management and prevention of conflict as well as sources of help such as mediation or arbitration.
According to a recent CIPD report, the average cost associated with employment tribunal claims comes to almost £20,000 per employing organisation each year. Employers spend an average of 15 days management time dealing with a claim.
Many of these claims can start with situations such as employee problems not taken seriously, badly handled discipline interviews or misunderstandings between people – issues which if not dealt with, can become tribunal claims.
The advisory booklet can be downloaded from Acas’ website and hard copies of the advisory booklet can be ordered from the publications orderline on 08702 429090.
Further information:
Acas publishes new guidance to help managers manage conflict at work effectively http://www.acas.org.uk/index.aspx?articleid=1256
Advisory booklet - Managing conflict at work http://www.acas.org.uk/media/pdf/5/0/B19_1.pdf
The Special Commissioner, in a decision given on 5 March 2007 in the case Parade Park Hotel & Anor v Revenue & Customs, has ruled against an HMRC determination that Mr. May was an employee for PAYE tax and NICs purposes and that the hotel for which he did maintenance work had a liability in respect of Mr. May’s earnings of £7,188.
The decision is lengthy and, in allowing the appeal, the Special Commissioner refers to the unusual, if not unique, circumstances of the case. One of the particularly unusual features of the case is that Mr. May had a drinking problem that meant he often did not come to work, a situation of which the hotel owner was endlessly tolerant.
The Special Commissioner’s decision is well worthy of study by anyone wishing to understand more clearly the many different factors that may need to be considered in evaluating employment status. In particular, the decision considers such issues as:
- taking into consideration all of the different aspects of the working relationship
- that some factors, such as who provides materials and the absence of employment benefits, may be significant in some working relationships but neutral in others
- the amount of work that a worker might perform for other clients
- the meaning of “mutuality of obligation” and how this principle can apply to both a long-term contractual relationship and to each short-term task performed
- the extent to which there has to be control over the work performed and what constitutes an “irreducible minimum” level of control for a master/servant relationship to exist
- the need to consider mutuality of obligation and control first, before considering other factors
- the factors that indicate whether or not a person is in business on his own account
- the relevance of the length of the working relationship.
Further information:
Parade Park Hotel & Anor v Revenue & Customs http://www.bailii.org/uk/cases/UKSC/2007/SPC00599.html
The current statutory dispute resolution procedures came into operation in October 2004. In December 2006, Michael Gibbons was asked by the DTI to review the way in which the procedures were being used and recommend ways in which they could be simplified and improved.
The Gibbons Review was published in March 2007 and, although acknowledging that there is consensus that the intentions of the original Regulations were sound and that there was a genuine attempt to keep the procedures simple, the Review indicates that the procedures have had unintentional consequences which have outweighed their benefits.
The DTI has now published a consultation document that seeks views from businesses, individuals, trade unions, representative bodies, and other interested parties on whether there should be
- a new, swift approach for dealing with straightforward claims without the need for employment tribunal hearings
- a reformed tribunal system with simplified processes and timings
- an invitation to the CBI, TUC and other representative organisations to produce guidelines aimed at encouraging and promoting early resolution in the workplace
- incentives for employers to make reasonable attempts to resolve a dispute early
- a redesigned application process to tribunals application process, so potential claimants access the system through a new advice service, and receive advice on alternatives when doing so.
The consultation will close on 20 June 2007. A consultation response form is available and comments can also be made online.
This consultation relates to England, Wales and Scotland. The Department for Employment and Learning, Northern Ireland will consult on similar proposals for Northern Ireland.
DTI consults on streamlined workplace dispute resolution http://www.gnn.gov.uk/content/detail.asp?ReleaseID=272858&NewsAreaID=2
Success at work: resolving disputes in the workplace: a consultation http://www.dti.gov.uk/files/file38553.pdf
Resolving disputes in the workplace: consultation response form http://www.dti.gov.uk/files/file38558.doc
Better dispute resolution: a review of employment dispute resolution in Great Britain http://www.dti.gov.uk/files/file38516.pdf
HMRC has given details of an error on page 6 of the E12(2007) Employer HelpbookPAYE and NICs rates and limits for 2007-08. For women whose babies are due on or before 31 March 2007, the two dates shown for average weekly earnings should be 15 July 2006 and 16 July 2006, not the dates given in 2007.
The Budget 2007 version of the Helpbook will contain the corrected figures.
Further information:
Error on page 6 of the Employer Helpbook E12(2007) – PAYE and NICs rates and limits for 2007-08 http://www.hmrc.gov.uk/employers/error-on-p6.htm
Following parliamentary approval of the National Insurance Contributions (Application of Part 7 of the Finance Act 2004) Regulations 2007, as covered in last week’s Newsletter, HMRC has published a guidance booklet on Disclosure of National Insurance Avoidance Schemes.
Further information:
Disclosure of National Insurance Avoidance Schemes http://www.hmrc.gov.uk/aiu/avoidance-scheme.pdf
The project to consolidate and rewrite all of the UK’s tax law started in 1997. The Acts and Regulations that have appeared so far are
- the Capital Allowances Act 2001, from 6 April 2001
- the Income Tax (Earnings and Pensions) Act 2003, from 6 April 2003,
- the Income Tax (PAYE) Regulations 2003, from 6 April 2004
- the Income Tax (Trading and Other Income) Act 2005, from 6 April 2005.
The latest Act to be completed is the Income Tax Act 2007 which comes into force on 6 April 2007. This Act provides the source legislation for the rates at which income tax is charged, the thresholds between which the rates apply, the method by which a person’s income tax liability for a year is calculated, and the allowances and reductions available.
Further information:
Income Tax Act 2007 http://www.opsi.gov.uk/acts/acts2007/ukpga_20070003_en.pdf
Tax Law Rewrite http://www.hmrc.gov.uk/rewrite/index.htm
(This updates the item included in the Newsletter two weeks ago.)
Employers that file electronically were sent P35N notifications from 7 March onwards reminding them of their obligation to file their P14 and P35 returns by 19 May 2007.
Employers may file their returns before the end of the tax year, as soon as they are ready. However, the following restrictions should be noted for the period 4 April to 7 April.
Between 6 a.m. on 4 April to 6 a.m. on 6 April, HMRC’s PAYE Online - Internet service will be unavailable due to the annual upgrade. During that period it will not be possible to
- prepare and file returns using the online facilities on HMRC’s website, or
- download coding and other notices from HMRC’s website.
However, employers may continue, during that period, to file returns by Internet or Electronic Data Interchange (EDI) using third-party software.
Returns that are filed electronically on Saturday 7 April will not receive an acceptance or rejection message until Sunday, 8 April. Employers filing on this date must wait until the Sunday before deciding whether to send the Return again or make an amendment. If an acceptance has not been received by the Tuesday, the Online Service Helpdesk (0845 605 5999) should be contacted.
Further information:
2006-07 PAYE Returns: Sending your return online between 4 and 8 April: Update
http://www.hmrc.gov.uk/payeonline/news-4-8april.htm
The Chancellor presented his 2007 Budget to Parliament on Wednesday, 21 March 2007. While press attention has been focussed on the political issues raised by the tax rate changes announced by Gordon Brown and on which taxpayers will gain or lose from the measures, there has been relatively little comment on the significant step that is being taken towards aligning PAYE tax and Class 1 NICs.
The thresholds above which employees start to pay tax and NICs are already aligned - £100 a week from April 2007. By April 2009, the threshold at which the 40% higher tax rate applies and the NICs upper earnings limit will also be fully aligned.
In commenting on the changes to personal taxation, Chapter 5 of the Economic and Fiscal Strategy Report states:
“The Government is today also announcing important reforms to personal taxation. These are detailed earlier on in this chapter and include: changes to the starting and basic rates of income tax, increases in the higher rate threshold for income tax and in age-related income tax allowances, and aligning the UEL and UPL for NICs. As announced at Budget 2006, the Government is also conducting a review of the case for further alignment of the income tax and national insurance systems.”
What next? Aligning gross pay for tax with gross pay for NICs? Taxation of benefits under PAYE with corresponding liabilities for Class 1 instead of Class 1A NICs? Cumulative Class 1 NICs? The two systems of employment taxation are still far apart but aligning the thresholds is an important first step.
The following notes describe all of the payroll-related changes announced in the 2007 Budget.
There are no changes to income tax rates for 2007/08. As defined by the statutory calculation and rounding rules in section 1 of the Income and Corporations Taxes Act 1988, (from April 2007, section 21 of the Income Tax Act 2007), the thresholds for 2006/07 are increased in line with the year-on-year increase in the Retail Price Index (RPI) at September 2006 (3.625%) and are set out in the Table below.
Tax Rates |
2006/07 |
2007/08 |
Starting rate, 10% |
£0 - £2,150 |
£0 - £2,230 |
Basic rate, 22% |
£2,150 - £33,300 |
£2,230 - £34,600 |
Higher rate, 40% |
Over £33,300 |
Over £34,600 |
The tax threshold changes require adjustments to Taxable Pay Tables, i.e. the Calculator Tables and Tables SR + B to D. They will be available on the Employer CD-ROM that will be sent to employers in the Employer Budget Pack. The new tax bands take effect from the first payday on or after 18 May 2007 (tax week 11).
Any changes to tax codes will be sent to employers on individual forms P6(T) or their electronic equivalents. Instructions on how to apply coding notices is provided on form P7(X), also included on the Employer CD-ROM. The tax code shown on any P6(T) forms dated 6 May 2007 should be applied as stated. No changes should be made to any other tax codes. No P6(T) forms will be issued after 6 May until 27 May 2007. All Tables and forms can also be ordered from the Employer Orderline, on 08457 646646.
In addition to the personal tax allowance – £5,225 from 2007/08 – there are two age-related personal allowances. For 2007/08 these are £7,550 for those aged 65 to 74, and £7,690 for those age 75 and above.
From April 2008, the two age-related allowances will increase by £1,180 above the normal annual indexation increase, taking them to £9,000 or more. Indexed rises will be maintained in the following two years but, by 2011, the Government’s intention is for the age 75 allowance to be £10,000.
In 2001, the annual personal tax allowance was aligned with the annual Class 1 NICs earnings threshold. The effect is that a person entitled to the full personal tax allowance starts to pay both PAYE tax and Class 1 NICs at the same level of earnings – £5,225 for 2007/08.
From April 2009, the following three thresholds will all be aligned at the same figure:
- the basic rate limit (BRL), i.e. the annual threshold above which the higher rate of tax applies, after allowing for the annual personal allowance – £39,825 (i.e. £5,225 + £34,600) for 2007/08
- the annual Class 1 NICs upper earnings limit (UEL) – £34,840 for 2007/08
the self-employed annual Class 4 NICs upper profits limit (UPL) – £34,840 for 2007/08.
Alignment of the upper thresholds will be achieved by:
- in April 2008, removing the 10% starting rate for earned income and pensions and reducing the 22% basic rate of tax to 20%
- in April 2008, increasing the UEL and UPL by £3,900 above indexation
- in April 2008, increasing the BRL by normal indexation
- in April 2009, increasing the BRL by normal indexation, increasing the UEL and the UPL to the same figure and then adding a further £800.
The following Table gives the actual thresholds for 2006/07 and 2007/08 and then estimates the thresholds for 2008/09 and 2009/10, using the statutory indexation rules based on a year-on-year increase in the RPI of 3% each year.
Annual Thresholds |
2006/07 |
2007/08 |
2008/09 |
2009/10
before alignment |
2009/10
after alignment |
|
|
|
|
|
|
Personal tax allowance |
£5,035 |
£5,225 |
£5,385 |
£5,555 |
£5,555 |
NICs earnings threshold (A) |
£5,035 |
£5,225 |
£5,385 |
£5,555 |
£5,555 |
|
|
|
|
|
|
Higher tax rate threshold (B) |
£33,300 |
£34,600 |
£35,700 |
£36,800 |
£37,580 |
Basic rate limit (A+B) |
£38,335 |
£39,825 |
£41,085 |
£42,355 |
£43,135 |
NICs upper earnings/profit limit |
£33,540 |
£34,840 |
£39,790 |
£40,990 |
£43,135 |
From 6 April 2007, payments received by an individual providing services through a “managed service company” (MSC), if not already treated as employment income, will be deemed to be employment income and, as a result, subject to PAYE tax and Class 1 NICs.
Where an MSC incurs a PAYE/NICs debt which cannot be recovered from the company, the debt will transfer to one of a number of specified persons. Provided Royal Assent takes place before 6 August 2007, the transfer of debt provisions will take effect from that date in relation to debts incurred for directors or office holders of MSCs and MSC providers, and to debts incurred on or after 6 January 2008 for other persons.
Extra-Statutory Concession A104 was introduced in July 2004 to remove an anomaly whereby employees earning less than £8,500 could incur a double tax charge where they are provided with car and car fuel benefits via an employer’s credit card or voucher. Where the value of expenditure incurred by means of a non-cash voucher or credit card takes the employee’s earnings rate to £8,500 or over, the employee would have to pay tax on the value of the voucher or credit card and on the provision of the car and, in addition, be taxed on the benefit of the car and any car fuel. ESC A104 prevents that situation from arising.
From April 2007, the ESC will be brought directly into legislation by amendments to the Income Tax (Earnings and Pensions) Act 2003, with no changes to its effect.
The following announcements apply to the car benefit and car fuel benefit charges:
- The car benefit percentage charge for the provision of a company car is between 15% and 35% of the list price of the vehicle. Currently, the 15% charge applies to cars with an emission rating of between 145 and 145g/km, and increases by 1% point for each further 5g/km, up to a maximum of 240g/km. From 2008/09 the minimum threshold reduces to 135g/km and this level will also apply for 2009/10.
- Discounts from the relevant percentage charge apply to some alternative fuel cars. From April 2008, a discount of 2% from the charge for an equivalent petrol-only car will apply to cars capable of using high-blend bioethanol E85, i.e. petrol mixed with up to 85% bioethanol. The code letter for use on form P46(Car) and form P11D will be ‘G’.
Bioethanol is a liquid biofuel made from starch plants (e.g. corn and wheat), sugar plants and some cellulose plants (trees). Production involves fermentation, distillation and dehydration.
As a fuel, bioethanol can be used as a 5% to 85% blend with petrol. Petrol containing only 5% bioethonal can be used in all petrol engines. Engine modifications are needed, however, if the E85 blends are used.
- The provision of fuel for private use in a car that is subject to the car benefit charge is calculated by applying the car benefit percentage charge to a fixed “multiplier” value. The multiplier is £14,400 for the 2006/07 tax year and this value will also apply for the 2007/08 tax year.
Budget 2006 announced that HMRC would review the taxation of employee car ownership (ECO) schemes and the benefits employees derive from them, with a view to possible changes. During summer 2006 and January 2007, HMRC’s consultation with businesses demonstrated there are a number of different ECO schemes and that there is a noticeable interaction between the tax treatment of ECO schemes, tax-free mileage allowances (AMAPs) and rates of company car tax, which may have contributed to the popularity of ECOS.
The review also suggested that the more structured ECO schemes make extensive use of AMAPs to reduce their tax and NICs liabilities. HMRC is concerned that this may encourage employees to drive a greater number of business miles. Therefore, ahead of the 2007 Pre-Budget Report, the Government will consider the case for changing the structure of AMAPs to align the tax/NICs treatment and to ensure that rates and thresholds are set at an appropriate level to promote environmentally responsible business travel.
In response to consultation, HMRC’s investigation powers in England, Wales and Northern Ireland will be based on the Police and Criminal Evidence Act (PACE).
The appropriate powers and safeguards in PACE are those already applied to criminal investigations by HMRC concerning ex-Customs and Excise matters. They include:
- applying to magistrates and judges for search warrants
- applying to judges for court orders to obtain evidence from people other than the suspect
- arresting suspects, search upon arrest and questioning.
For Scotland, the measure will introduce new and consistent powers and safeguards for HMRC’s criminal investigations including:
- applying to sheriffs for search warrants
- applying to sheriffs for court orders to obtain evidence from people other than the suspect
- provisions to help identify suspects and potential witnesses
- arresting suspects, search upon arrest and questioning .
Also following consultation, the Government is to introduce a single new penalty regime for incorrect returns for income tax, corporation tax, PAYE, NICs and VAT. Penalties will be determined by the amount of tax understated, the nature of the behaviour giving rise to the understatement and the extent of disclosure by the taxpayer. The regime also includes a new concept of suspended penalties.
The introduction of the requirement to file in-year forms P45 and P46 electronically is being delayed until April 2009 for large and medium-sized employers and until April 2011 for small employers.
HMRC explains:
“This deferral to mandatory online filing of in-year information is made in response to employers’ concerns about the complexity of the changes needed to their own internal processes. It gives large and medium-sized employers more time to prepare and become accustomed to the validation routines before penalties begin to bite in the last quarter of 2009-10. We will use the extra time to make sure that our systems will fully support employers, so that they can build their confidence in using them when they send data to us online.”
The delay in starting mandatory electronic filing or in-year forms does not affect:
- the introduction of new P46 procedures from April 2008
- the requirement to send P46 information when an employee’s earnings reach the NICs lower earnings limit instead of the earnings threshold.
The Government is adding to the list of benefits which, if provided to former employees from a non-registered pension scheme, are excluded benefits and, as a result, are not subject to a tax charge. The exclusion applies to tax year 2006/07 and onwards. The benefits are:
- non-cash benefits that were chargeable to tax before 6 April 1998
- certain living accommodation, namely
- accommodation provided by local authorities, i.e. council houses provided on equivalent terms to other council tenants
- accommodation provided for a former employee or, if deceased, for a family member and
- the employee had lived there continuously for five or more years immediately prior to retirement,
- the accommodation was not taxable because it was provided for the performance of the employee’s duties, and
- after retirement, the employee or family member continues to occupy the same or similar accommodation.
- accommodation provided for a former employee
- which was previously provided because the person was an employee,
- which was not taxable because it was provided as the result of a security threat to the employee, and
- following the end of the employment, those security threats continue.
- other non-cash benefits, namely
- removal expenses and related insurances incurred in transporting domestic belongings of a former employee’s former residence to the former employee’s new residence
- welfare counselling provided to a former employee that is also made available to all of the employer’s pensioners on similar terms
- recreational benefits that would be exempt from a tax charge if the former employee were still in employment
- the provision of an annual party or similar annual function for which there would have been no tax charge if the former employee had attended as an employee
- the provision of will-writing services for a former employee where the cost to the employer does not exceed £150
- the provision of, or the replacement of, equipment for a disabled former employee that was first provided when the former employee was in employment and which, at that time, was exempt from a tax charge.
Payroll deadlines during the next month
April 5 – This is the final day of tax month 12 and of the tax year. Tax and NICs etc. for payments made in the tax month to April 5, and any outstanding tax and NICs etc. for the tax year, are due for payment to the Accounts Office by April 19, or by April 22 if paid electronically.
April 6 – This is the first day of the new tax year.
April 19 – This is the deadline for payment of tax and NICs to the Accounts Office, for tax month 12 by employers who pay monthly, for tax months 10 to 12 by employers who pay quarterly, unless they make their payments electronically. This is also the latest date for paying any outstanding tax and NICs to the Accounts Office in respect of the 2006/07 tax year.
April 20 – (April 22 is a Sunday) – For employers who pay their tax and NICs to the Accounts Office electronically, this is the deadline for electronic payments to be cleared into the HMRC bank account. Payments through BACS must be initiated by April 18 at the latest.
Payroll FAQ's
Essential User Allowances
Payments of mileage allowances are only reported for tax purposes on form P9D or P11D if the total of all mileage allowance payments made in the year exceed the statutory maximum for the vehicle (i.e. car, van, motorcycle or bicycle). If more than the maximum is paid, only the excess is reported. A similar procedure applies for Class 1 NICs, but the comparison between the payments made and the maximum must be made for each earnings period.
The maximum amount that may be paid without any tax liability is calculated, in the case of a car or a van, by multiplying the business mileage in the tax year by 40p for the first 10,000 miles, and by 25p for any mileage over 10,000 miles.
The question here is how essential user allowances should be handled in this context. It has been the longstanding practice of some employers, particularly local authorities and housing associations, to add such payments to gross pay in each pay period and deduct PAYE tax and NICs accordingly. This is not the correct way of taxing essential user allowances and, if they are taxed in this way, it raises complications when completing P9Ds or P11Ds and can mean that employees pay more tax and employers pay more NICs during the year than they should.
The P11D Working Sheet 6 refers simply to the total “mileage allowance payments” made during the tax year. This term is not defined and there is nothing on the P11D itself, in the P11D Guide or in the 480 Expenses and Benefits booklet that reminds employers that essential user allowances should be included in the total mileage allowance payments.
All is made clear elsewhere, however. The IR124 booklet, written for employees, refers to an allowance that “can be in the form of a lump sum or periodic payments”. The 490 Employee Travel booklet describes “motoring expenses” as including “mileage allowances which are based on a set rate per mile, lump sums, business use car allowances and payments for fuel purchased for business use.”
HMRC’s online Employment Income Manual, at page EIM31210, gives as an example of a mileage allowance payment “a lump sum payment aimed at covering the business proportion only of the standing costs of the car – for example, we accept that the lump sum instalment payments for regular business drivers made at nationally agreed rates by many local authority and NHS employers are for this purpose.”
Therefore, the intention is that an employee’s tax liability under the mileage allowance rules should be determined at the year-end, not through the payroll. All the mileage payments made to the employee during the tax year, including essential user allowances, should be totalled and, if the total is less than the statutory maximum for the year, there is nothing to report on form P11D at all. If the total payments for the year exceed the statutory maximum, only the excess is reported.
All is not lost if essential user allowances have been taxed through the payroll. In section 1 of P11D Working Sheet 6, the amount from which tax has been deducted is entered as a “minus” amount in Box B, thereby reducing the total allowances for the year before they are compared with the statutory maximum amount. However, this may serve to demonstrate that the employee has paid tax on the essential user allowance unnecessarily through the payroll. The tax liability on all mileage allowance payments should only be determined at the year end.
Similarly, if all of the essential user allowances paid during the tax year have been handled through the payroll, it may well be that the employer, and possibly the employee, have overpaid Class 1 NICs. The procedures that should be followed in each earnings period are similar to but rather more complex than the tax calculation. Examples of the calculations in various situations are shown in Chapter 6 of the 490 Employee Travel booklet.
From 23 March 2007, the provisions of the Employees (Provision of Information and Consultation) Act 2006 are extended to employers with at least 100 employees. The Department of Enterprise, Trade and Employment has published a new explanatory guide to the Act for employers and employees.
Further information:
Employees (Provision Of Information and Consultation) Act 2006 - Explanatory Booklet for Employers and Employees http://www.entemp.ie/publications/employment/2007/guideprovinfoact2006.pdf
Minister Killeen Announces Publication of a Guide to the Employees (Provision of Information and Consultation) Act 2006http://www.entemp.ie/press/2007/20070322.htm
Income tax rates and thresholds
There are no changes to tax rates or to tax thresholds for resident individuals. Personal allowances increase, from 6 April 2007, as follows:
|
2006/07 |
2007/08 |
Single person |
£8,670 |
£8,850 |
Married couple (combined) |
£17,340 |
£17,700 |
Single parent addition |
£5,920 |
£6,040 |
Blind person |
£2,665 |
£2,720 |
Disabled person |
£2,665 |
£2,720 |
Co-habiting couple’s maximum addition |
£5,920 |
£6,040 |
Non-resident’s personal allowance |
£2,000 |
£2,040 |
Personal Allowance Credit
The Personal Allowance Credit is paid to resident individuals who do not fully utilise their personal allowance. The amount of the credit will be increased by 20%, from £350 to £420, with effect from 6 April 2007. All amounts and limits are doubled for jointly assessed married couples.
The full payment is due where a person’s income is below the lower income point and a restricted payment is due where a person’s income is between the lower and the upper income point. The lower income point will be increased from £6,000 to £6,170 and the upper income point will be increased from £8,500 to £8,670 for payments made after 6 April 2007.
When making a restricted payment of the Personal Allowance Credit, an abatement factor is used; this factor is increased from £1.40 to £1.68 for every £10 over the lower limit.
Benefits In Kind
A review is to take place before the 2008 Budget with a view to changing the way that the benefit in kind charge is calculated for cars and fuel. The review will focus on changing the current car benefit and car fuel tables to encourage the use of vehicles with lower emission rates and those which use environmentally friendly fuels.
In the meantime, electric cars provided by an employer will no longer be subject to a tax charge. With effect from 6 April 2007, the tables used to calculate the charge have been changed to ensure that an employee who receives the benefit of private use of an electric car is no longer charged income tax on that benefit.
Following liaison with interested parties, a new benefit in kind category may be added to the current benefit in kind exemptions Order. The exemption will mean that an employee will not incur a tax charge where their employer pays for ‘season tickets’ or ‘multi journey tickets’ to and from work on normal scheduled public transport, or similar coach services. Importantly, the employer must pay the travel operator directly and the exemption will not apply to the reimbursement of home to work travel costs. The relevant Order will be drafted as soon as possible.
Further information:
Budget 2007 – Income Tax Proposals http://www.gov.im/lib/docs/treasury/incometax/pdfs/practicenotes/pnbudget2007final.pdf
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