Personal Tax

[karenT]

Hi,<BR><BR>I have just started studying personal Tax and have yet to receive the text book. Hence I am stuck on the following question relating to benefits in kind of a senior employee:<BR><BR>Mr X took meals in the fully subsidised executive canteen, the cost for the year being £335. Another subsidised canteen was available for the other staff.<BR><BR>Basically, is this included in schedule E as benefits in kind? If so is it the full £335 or a %. Are there any cases where costs of the other canteen would be taken into account?<BR><BR>If anyone can shed any light on this I would be grateful.<BR><BR>Ta

[Simon]

I think I am right in saying that the full amount would be taxable. If the canteen were available to all employees the benefit would not be taxable.<BR><BR>Hope this is of help.<BR>

[karenT]

cheers simon,<BR><BR>I've actually been to college today and my tutor says that since it doesn't say that the other canteen costs are different, then we must assume that it too is £335 and, therefore, there is no benefit the subsidised meals are then provided to all employees. If, however, the other canteen's costs are different then the difference itself would be a benefit.<BR><BR>Thanks for your help

[clivesmith999]

Karen<BR><BR>It sounds like your tutor is giving 2 anwsers although the Inland Revenue would probably take the one that gives them the most tax. Simon's anwser is more concise because the benefit given in the excutive canteen is not available to all employees therefore it is taxable. As to whether the other staff canteen is available to all employees might depend on whether the directors can use it and I doubt there would be anyone in the company that would want to stop them using therefore not taxable! <BR> <BR>Clive

[clivesmith999]

Just to clarify my anwser, the executive canteen would be taxable as not available to all employees, but the staff canteen is not taxable as it would be available to all.

[karenT]

cheers clive,<BR><BR>I think I am going to be using this forum quite a bit over the next year. I've only been back at college 4 weeks and already the questions are mounting up (I found foundation and most of intermediate a doddle). Anyway thanks to both you and simon

[bryan]

I have followed this discussion with interest and I could be persuaded by the arguments wetre it not for ITEPA 2003 S.317(1)(a) which excludes from the benefits regime the cost of facilities for employees provided on the premises or in designated public places.<BR><BR>On a practical note, is it seriously suggested that the cost of supplying food to each employee is recorded, a deduction made for the cost of supplying food to other ranks and then including this on a P11d?<BR><BR>I cannot see this creating a BIK but it is possible that there may be an add back for CT, after discussion with the IR, if it arises.