Benefit In Kind

A benefit in kind is a non-cash reward that an employee may receive from their employer as part of their overall compensation – often known as perks. Many benefits in kind are completely tax free, such as a free meal or uniforms, but there are exceptions. These exceptions include but are not limited to:

  • A company car that you can also use for personal use
  • Fuel that you can use for your own private car use as well
  • Private health insurance

Essentially, any item that’s not wholly, exclusively and necessarily used for work is most likely a benefit in kind and is taxable. You can find your benefits in kind listed on your P11D.

Your benefits in kind are taxed to ensure they aren’t offered to replace a higher salary that would impact your tax liabilities – known as a salary sacrifice.

Some benefits that are not liable to tax include:

  • Work phone
  • Staff canteen meals
  • Business expenses paid for on a company card
  • Training paid for by the employer
  • Personal pension contributions
  • Non-cash birthday, wedding, leaving etc. gifts

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