Produced by Tolley

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

  • Broadband
  • Introduction
  • Broadband and telephone services provided together
  • Exemptions and deductions for the provision of broadband
  • Exemption for accommodation, supplies and services provided to employees
  • How is ‘performance of the duties’ defined?
  • What is ‘significant private use’ for broadband?
  • Exemption for increased costs as a result of homeworking
  • Deduction under the general rule for expenses
  • Broadband as a benefit
  • More...



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 NIC for the broadband. Where there is no exemption, there may be a deduction. If neither of these applies, then the benefit is taxable and NICable. The reporting requirements vary according to how the provision is arranged and paid for.

The key difficulty with broadband is where there is mixed personal and business use. The vast majority of broadband packages do not identify the different expenditure so it may be impossible to say what amount relates to private use and what relates to business use. If broadband is provided and there is significant private use then, unless the specific business elements can be identified, the full amount is taxable.

Broadband and telephone services provided together

Broadband and telephone services may be provide

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