The first of these exempted from being taxable is Covid antigen tests provided by employers to their employees. These are usually conducted by way of swab samples being taken from the back of the mouth or up the nose.
The rules on what constitute benefits-in-kind are widely written and if government wants to drop something out of the scope of being a benefit-in-kind, then it’s often necessary to give a specific exemption, even if the something can be seen to be for the public good and, frankly, a little unpleasant for the recipient. Nonetheless, it benefits an employee to know whether or not they have the virus and, as such, it’s a benefit-in-kind.
Thus, a specific exemption was needed to take antigen testing out of being taxed. The revision is effective from 8 December 2020 until 5 April 2021 and HMRC will not seek to tax employers provided antigen testing carried out before 8 December 2020, so that these tests will be exempt for the whole of the 2020-21 tax year. This means no income tax payable by employees who are tested and no Class 1A National Insurance payable by employers who provide the tests.
On a more enjoyable note, HMRC has confirmed that virtual Christmas parties do qualify for the £150 annual event exemption, having previously indicated that they would not. Of course the same qualification requirements exist for virtual parties as actual parties and costs on a per head basis should not exceed £150 and events should be open to all employees or all employees who work at a particular location or in a particular department.
This is a welcome easement and it’s hoped that it’s one that won’t need to become an annual event, or even one that’s repeated for next summer’s annual barbecue!
The next step
If you need advice on which benefits-in-kind are in, or out, or shaken all about, then do the hokey-cokey down to your nearest UHY Hacker Young office and find out what it’s all about!