Introduction

Employers may provide broadband access to employees, usually as part of homeworking arrangements, or for employees who are likely to be required to work from home out of hours. Alternatively, the employer may simply provide broadband as a benefit. The PAYE treatment of the provision of broadband depends on both why and how the provision is made.

The key considerations are:

1. •

   why has the broadband been provided?

2. •

   what is the broadband actually used for (business, personal or combined use)?

3. •

   who has the contract with the provider?

4. •

   who pays for the broadband ― does the employee simply receive the broadband with no involvement in the administration, is their bill paid for them, or are they reimbursed as an expense?

In order to determine the correct treatment, first you will consider whether there is an exemption from tax and national insurance contributions (NIC) for the broadband. Where there is no exemption, there may be a deduction. If neither of these applies, the benefit is subject to tax and NIC. The reporting requirements may vary according