Employment Tax

Assets ― bought, sold or given

Produced by Tolley
  • 21 Dec 2021 16:44

The following Employment Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Assets ― bought, sold or given
  • Assets transferred to the employee
  • Transfer of a new asset
  • Transfer of a used / depreciated asset that has never been used by any employee
  • Transfer of a used / depreciated asset that has been provided for use by an employee
  • Exceptions
  • Reporting
  • Employer
  • Employee
  • Salary sacrifice
  • More...

Assets ― bought, sold or given

If an employer gives an asset to an employee (ie the employer transfers ownership of the asset), a taxable benefit arises. Examples of assets that could be transferred to employees are computers, company cars and office furniture. These rules apply equally to employees and directors, therefore all references to employees in this note include directors. If an asset is made available to an employee without transfer of ownership, different rules apply, see the Assets ― made available to an employee guidance note.

With any employment reward, if the asset is provided or transferred by a third party, rather than the employer, it is worth considering whether the disguised remuneration provisions in ITEPA 2003, Pt 7A, ss 554A–554Z21 apply, as those rules have priority over most of the other rules for taxing employment income. The rules are discussed in detail in the Disguised remuneration ― overview guidance note.

There are three possible types of asset transfers one could come across:

  1. transfer of a new asset (ie unused and undepreciated)

  2. transfer of a used or depreciated asset which has not been used by any employees

  3. transfer of a used or depreciated asset which has been provided for use by one (or more) employees

The cash equivalent of the benefit is different depending on which of these three situations applies. Where the asset transferred to the employee is a car or a computer the calculation of the rules are altered (see the exceptions below).

Assets transferred to the employee

Transfer of

Access this article and thousands of others like it
free for 7 days with a trial of TolleyGuidance.

Think Tax.
Think Tolley.

Critical, comprehensive and up-to-date tax information

LEARN MORE LEARN MORE

Popular Articles

Utilising the capital gains tax annual exemption

Taxpayers may wish to consider basic tax planning arrangements in use the capital gains tax annual exemption. This type of tax planning is often reviewed at the end of the tax year.This guidance note first looks at the annual exemption in detail and then various tax planning strategies that might be

27 Oct 2021 19:10 | Produced by Tolley Read more Read more

Tax returns to date of death

Personal representatives are responsible for finalising the deceased’s tax affairs. They must file outstanding tax returns and claim any repayments due.For many estates where the deceased’s tax was deducted under PAYE on pensions or employment, a refund is likely to arise because the deceased is

19 Oct 2021 23:13 | Produced by Tolley Read more Read more

Winding up a trust

When does a trust come to an end?A trust may come to an end because it has run its course and comes to a natural end. If a trust has no assets , it ceases to exist. Alternatively, a trust ends because the trustees or beneficiaries decide to wind it up: the trustees distribute the assets by

03 Nov 2021 11:52 | Produced by Tolley Read more Read more