Self – Assessment 2019.
If you are one of those people who have to complete a tax return even though you are in employment and believe your tax is dealt with accordingly, things may not be as clear cut as they may seem.
Some employees receive ‘benefits in kind’ (BIK) through their job, some of which are as follows:
- A company car (BIK)
- Private medical care (BIK)
- Mileage allowance (BIK) or
- You are reimbursed for expenses you have paid in the course of your duty
- You are not reimbursed for expenses paid by yourself in the performance of your duty
These are to name but a few of the items.
If you do receive ‘benefits in kind’ or ‘reimbursements’ you should receive a copy document from your employer which reports these items to the HMRC, this document is known as a P11d and should be released to yourself and HMRC by no later than 6th July and in turn these should be reported on your tax return
Please be aware that the annual PAYE tax codes that are issued by HMRC are based on the prior year’s information, therefore, any changes in ‘benefits in kind’ or changes to ‘expenses’ reimbursed or otherwise, should be reported on the tax return for the relevant tax year.
If there are changes in the company car during the tax year this will need to be reported on the relevant tax return.
Private medical care usually has an inflationary increase each year, this also needs to be reported on the tax return
If the employer pays an employee for the business mileage travelled in the performance of their duties he may be either under or over paying the rate per mile. The HMRC recognised rate per mile is .45p, if the employer is paying more per mile the difference in the amount becomes taxable, if, however, he is paying less the employee can claim the difference against his taxable income/tax suffered through PAYE , either way this needs reporting on the tax return.
If the employee has paid for expenses in the performance of his duty and they have not been reimbursed by his/her employer these can be claimed on the tax return and depending on any of the above points may lead to an overpayment of tax.
If you have any queries in respect of this article please do not hesitate to give WatkinsonBlack a ring