Misc Benefits And Other Points

Question 1

What is the taxable benefit for zero emission Vans?

Answer 1

There is no taxable benefit for zero emission Vans.

This reflects the government’s incentive to promote environmentally friendly vehicles.

Question 2

What is the annual benefit for providing a van with CO2 emissions to an employee with unrestricted private use?

Answer 2

£3,960 per year.

This amount is considered a taxable benefit under personal income tax regulations.

Question 3

What additional benefit is provided when an employer offers free or subsidised fuel for private use?

Answer 3

£757.

This is also a taxable benefit under the Income Tax (Earnings and Pensions) Act 2003.

Question 4

Under what conditions is there no van or fuel benefit?

Answer 4

If private use is insignificant or if the restricted private use condition is met.

This ensures that only significant private use is taxed.

Question 5

What is the tax implication if an employee is given vouchers?

Answer 5

The cost of providing these is taxable as a benefit.

This is stated under ITEPA 2003, section 87.

Question 6

What must be compared when an employer reimburses an employee for business mileage incurred using their own car?

Answer 6

The amount reimbursed must be compared with the tax-exempt limits set by HMRC.

This ensures compliance with tax regulations regarding mileage allowances.

Question 7

What happens if the reimbursed amount exceeds the tax-exempt limits?

Answer 7

The excess is taxable.

Employers must be careful to stay within these limits to avoid tax liabilities.

Question 8

What occurs if the reimbursed amount is less than the tax-exempt limits?

Answer 8

The shortfall is deductible.

This allows employees to recover some of their expenses.

Question 9

When did employer-supported childcare schemes close to new entrants?

Answer 9

4 October 2018

Existing members will continue to receive benefits.

Question 10

What is the exemption for basic rate taxpayers who joined an employer-supported childcare scheme after 6 April 2011?

Answer 10

First £55 pw

The exemption varies for higher and additional rate taxpayers.

Question 11

What is the exemption for higher rate taxpayers who joined an employer-supported childcare scheme after 6 April 2011?

Answer 11

First £28 pw

This exemption is lower than that for basic rate taxpayers.

Question 12

What is the exemption for additional rate taxpayers who joined an employer-supported childcare scheme after 6 April 2011?

Answer 12

First £25 pw

This exemption is the lowest among the three taxpayer categories.

Question 13

What was the exemption for all taxpayers who joined a scheme before 6 April 2011?

Answer 13

£55 pw

This exemption applies uniformly to all taxpayers.

Question 14

What is the maximum top-up amount per annum per child under the Tax-Free Childcare scheme?

Answer 14

£2,000

The maximum is £4,000 for a disabled child.

Question 15

What percentage is the contribution to the Tax-Free Childcare scheme topped up by?

Answer 15

25%

This applies to contributions made to an account for qualifying childcare.

Question 16

Until what date are top-up payments made for a child under the Tax-Free Childcare scheme?

Answer 16

1 September following their 11th birthday

This extends to the 16th birthday if the child is disabled.

Question 17

What are the income requirements for a person opening an account under the Tax-Free Childcare scheme?

Answer 17

Must not have adjusted net income of more than £100,000 per annum

Additionally, they must be in paid work and not a member of an employer-supported scheme.

Question 18

True or False: Employer-supported childcare schemes are still open to new entrants as of October 2018.

Answer 18

False

These schemes closed to new entrants on 4 October 2018.

Question 19

What are some examples of tax-exempt benefits?

Answer 19

• Employer contributions to a registered pension scheme
• Mobile phones (only one per employee)
• Removal expenses up to £8,000
• Exclusive nursery
• Car parking at or near the place of work
• Staff canteens available to all employees
• Incidental expenses for working away from home (£5 in UK, £10 abroad)
• Training costs
• Christmas party or other annual functions costing not more than £150 per head

Taxable and exempt benefits can be found in ITEPA 2003.

Question 20

What is the maximum cost for a trivial benefit to qualify for statutory exemption?

Answer 20

£50

The benefit cannot be provided in recognition of particular services carried out by the employee.

Question 21

What does OpRA stand for?

Answer 21

Optional Remuneration Arrangements

Question 22

In an OpRA, how is the taxable amount determined?

Answer 22

The higher of the cash amount the employee would have received or the taxable benefit amount

This is determined under the benefit rules before considering employee contributions.

Question 23

Which benefits are excluded from the OpRA rules?

Answer 23

• Provision of pensions advice qualifying for exemption
• Provision of cycles and cyclist safety equipment
• Tax-free employer-provided childcare
• Contributions to registered pension schemes
• Cars with low CO2 emissions (not exceeding 75g/km)

References: ITEPA 2003, s.69A and s.228A(5).

Question 24

What is the limit for incidental expenses for working away from home in the UK?

Answer 24

£5

Question 25

What is the limit for incidental expenses for working abroad?

Answer 25

£10

Question 26

True or False: A Christmas party costing more than £150 per head is considered a tax-exempt benefit.

Answer 26

False

Question 27

What is the tax treatment for removal expenses over £8,000?

Answer 27

Excess and non-qualifying costs are taxable

Question 28

What is the significance of the ITEPA 2003 contents list?

Answer 28

It is helpful as a memory jogger and to navigate the Act

Question 29

What is a PAYE Settlement Agreement (PSA)?

Answer 29

An employer settles the employee's tax liability in respect of an expense or benefit. ## Footnote PSAs simplify tax administration for minor expenses or benefits.

Question 30

What conditions must an expense or benefit meet to be included in a PSA?

Answer 30

An expense or benefit can be included in a PSA if it is: * minor * paid on an irregular basis * given in circumstances where it is impractical to apply PAYE or apportion the value of particular benefits shared by multiple employees. ## Footnote This allows for easier handling of certain employee benefits.

Question 31

Are amounts included in a PSA required to be reported on form PID?

Answer 31

No, amounts included in a PSA do not have to be reported on form PID. ## Footnote This reduces administrative burden for employers.

Question 32

Are amounts included in a PSA taxable on the employee?

Answer 32

No, they are not taxable on the employee. ## Footnote This is beneficial for employees as it lowers their taxable income.

Question 33

What legislation governs PAYE Settlement Agreements?

Answer 33

PSAs are in the legislation at SI 2003/2682, Reg 105 onwards and SP 5/96. ## Footnote This legislation outlines the rules and regulations surrounding PSAs.